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MSCI has included at least 20 new stocks in the MSCI India Domestic Small Cap Index while removing 17 others
MSCI India Rejig
MSCI announced on Wednesday that it has removed Adani Green Energy Ltd and added Hyundai Motor India Ltd to its MSCI India Domestic Index. These changes will take effect at the close of February 28, 2025. Additionally, MSCI has included at least 20 new stocks in the MSCI India Domestic Small Cap Index while removing 17 others.
Some of the stocks added to the Small Cap Index include Greaves Cotton, V2 Retail, Zaggle Prepaid, Websol Energy Systems, Cartrade, Allied Blenders, Ola Electric Mobility, Niva Bupa Health, and Sundaram Clayton. Other additions include Jyoti CNC Automation, Pearl Global Industries, Shaily Engineering, TBO Tek, and Manorama Industries.
On the other hand, stocks such as Jai Corporation, Sula Vineyards, DCB Bank, Bajaj Hindusthan Sugar, Bharat Bijlee, Sanghi Movers, Mahindra Logistics, and Spandana Sphoorty Financial will be excluded from the MSCI India Domestic Small Cap Index. According to estimates, these changes could bring in a net passive flow of between $850 million and $1 billion.
MSCI also clarified that, starting with the February 2025 Index Review, it will implement changes previously postponed for Adani Energy Solutions Ltd, including adjustments to the Number of Shares (NOS), Foreign Inclusion Factor (FIF), and Domestic Inclusion Factor (DIF).
“The proforma changes will be announced alongside the February 2025 Index Review and will be effective after the close of February 28, 2025 (March 3, 2025),” MSCI said.
Following these adjustments, Indusind Bank is expected to see a weight increase of $258 million, according to IIFL Capital (Alt Desk).
India’s weight in the MSCI index stands at about 19%, down from 19.8% in November 2024, while China’s weight has risen to 27.1% from 26.8%.
MSCI also noted that it has been closely monitoring Adani Group and its associated securities, including their free float, and will provide further updates if necessary.
In the MSCI Global Standard indices, 23 securities will be added, and 107 will be removed from the MSCI ACWI Index.
“The largest additions to the MSCI World Index by full company market capitalization will be United Airlines Holdings (USA), Reddit A (USA), and Natera (USA). The largest additions to the MSCI Emerging Markets Index by full company market capitalization will be Hyundai Motor India (India), Emaar Development (UAE), and J&T Global Express B (China),” MSCI added.
Due to ongoing market accessibility issues, MSCI stated that it would not implement any changes for securities classified in Bangladesh under the MSCI Bangladesh Indexes or related composite indices as part of this review.
