Nifty, Nifty Bank rejig due effective Dec 30. How your stocks could be impacted?
Analysts at Nuvama Alternative & Quantitative Research (NAQR) have analyzed the flow impact led by recapping of stocks in key Nifty Indices (Nifty 50, Nifty Bank and CPSE Index). These are the key Nifty Indices in India which are majorly tracked by the domestic passive funds. These changes shall become effective from this week on Friday, December 30, 2022 and adjustment will take place on December 29, 2022 (Thursday).
“The capping factor of stocks in all the Nifty Indices is realigned upon change in equity, investible weighted factor (IWF), replacement of scrips in the index, periodic rebalancing and on a quarterly basis on the last trading day of March, June, September and December by taking into account closing prices as on T-3 basis, where T day is last trading day of March, June, September and December,” said Abhilash Pagaria, Head, Nuvama Alternative & Quantitative Research.
In Nifty 50 Index, inflows are in Axis Bank ($21 mn), Bharti Airtel ($16 mn), Adani Ports and SEZ or ADSEZ ($11 mn) and HDFC Life ($9 mn). The highest outflows are in Bajaj Finance ($34 mn) and Bajaj Auto ($19 mn), as per the brokerage’s analysis.
In CPSE Index, the Inflows are in Power Grid and NTPC whereas the only stock, as per the brokerage, which will see meaningful outflow is ONGC.
Further, in Nifty Bank, there is recapping in all the constituents, and key Inflows are in HDFC Bank ($25mn), ICICI Bank ($22 mn), IIB ($19 mn), Federal Bank ($10 mn) and AUBANK ($9 mn. The highest outflows are in Axis Bank ($78 mn) and SBI ($32 mn), according to the analysis.
Thus, cumulatively the Top inflows are in HDFC Bank ($29 mn), ICICI Bank ($26 mn), IndusInd Bank ($19 mn), Bharti Airtel ($16 mn), Power Grid ($13 mn) and NTPC ($12 mn). Whereas top outflows are in Axis Bank ($57 mn), Bajaj Finance ($34 mn), State Bank of India or SBI ($32 mn) and Bajaj Auto ($19 mn), as per the research by Nuvama.
The views and recommendations made above are those of individual analysts or broking companies, and not of Mint.
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