NTPC is set to attract the highest inflows as a result of the quarterly readjustment, driven by an increase in its weightage in the CPSE Index to 20%, while Adani Enterprises will see its weightage in the Nifty 50 index rise to 0.6%, resulting in $15 million in inflows, according to Nuvama’s estimates.
Bharat Electronics is expected to see overall outflows of $19 million as a result of the quarterly readjustment, while HDFC Bank is set to witness overall outflows of $47 million, according to Nuvama’s estimates. ONGC and Coal India will likely see outflows of $17 million and $16 million, while State Bank of India is expected to see outflows of $57 million. Meanwhile, Nuvama estimated that ICICI Bank will witness overall inflows of $14 million.
On the Nifty 50 index, ICICI Bank and HCL Technologies are also expected to experience minor gains in weightage, leading to expected inflows of $4 million and $2 million, respectively.
Conversely, weightages for Tata Motors, Mahindra & Mahindra, Hindustan Unilever, and ITC in the Nifty 50 index are set to decrease, causing outflows of $9 million, $8 million, $3 million, and $2 million, respectively, according to Nuvama’s estimates.
The CPSE Index will see NTPC and Cochin Shipyard benefit the most from the rejig. While NTPC leads with $74 million in expected inflows, Cochin Shipyard’s weightage rise to 2% will likely result in inflows of $13 million. However, stocks such as Power Grid, Bharat Electronics, ONGC, and Coal India will face weightage cuts, leading to a combined outflow of $87 million, Nuvama Alternative & Quantitative Research said.In the Nifty Bank index, public and private sector banks, including Punjab National Bank, IndusInd Bank, Federal Bank, and Bank of Baroda, will see higher weightages and inflows. However, HDFC Bank, SBI, and Kotak Mahindra Bank will face reductions, leading to significant outflows of $59 million, $57 million, and $19 million, respectively.
Despite the changes after the quarterly rejig, analysts from Nuvama Institutional Equities anticipate limited overall volume impact for the Nifty indices. “Since it primarily involves float-led weight adjustments, the impact is expected to be relatively muted,” said Nuvama.
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