IRCTC, Tata Power, Zomato among stocks under possible inclusion in MSCI Index
Premium- Edelweiss reiterated its high conviction inclusion names along with 2 stocks on borderline for exclusion from the index
MSCI will announce its semi annual index rejig on Friday, November 12, 2021 and brokerage house Edelweiss believes that stocks like Zomato, SRF, Tata Power, Mindtree, Godrej Properties, IRCTC, and Mphasis could see the inclusion in the index.
If all of the above seven names, which are under Edelweiss' high conviction inclusion list, get included then India can see passive flow of around $1.3 billion, the brokerage firm said in a note. Though, it believes that IPCA Labs and REC Limited could see exclusion from the Standard Index.
“As per Edelweiss Alternative Research early assessment all the MSCI potential high conviction inclusion names holds a strong chance to move from current Midcap Categorization to Large cap Categorization. While, Zomato will be for sure fresh entrant in Large cap category," the note stated.
These predictions are as per Edelweiss Alternative Research Analysis and not the final names announced by MSCI. The global index provider MSCI (Morgan Stanley Capital International) rebalances its indices semi-annually and quarterly. The adjustment for its November semi-annual index rebalancing will take place on November 30, 2021 and the rejig will be with effect from December 1.
Edelweiss believes that Tata Power could be the largest beneficiary of inflows, with $240 million funds expected to come in favour of the company with an expected weightage of 0.5% in the index. “We have been flagging off Tata Power from 135 levels and now if stock sustains above 185 levels, then it can very safely qualify for MSCI November Inclusion," it said.
State-owned Indian Railway Catering and Tourism Corporation (IRCTC) could see $171 million of inflows, followed by $153 million inflows in favour of newly listed Zomato. “Although these two stocks qualify for inclusion in the MSCI Standard Index any meaningful decline from current levels till the cut-off date in October could hamper their chances," Edelweiss pointed.
MINT PREMIUM See All
Never miss a story! Stay connected and informed with Mint. Download our App Now!!