Paytm, Suzlon Energy and 7 other stocks likely to make a cut into MSCI index

Nine stocks will make a cut into the MSCI Global Standard Index viz. IndusInd Bank, Suzlon Energy, Persistent Systems, APL Apollo, Polycab, Macrotech Developers, Tata Motors DVR, One 97 Communications (Paytm), and Tata Communications resulting in combined inflows of $1.72 billion according to estimates by Nuvama.

Suzlon Energy, Persistent Systems, and APL Apollo's inclusion will see these stocks exiting the MSCI Smallcap Index.

The latest rejig of the MSCI Global Standard Index gets into effect from November 30 and the announcement is scheduled on Wednesday, November 15 around 3:30 am India time.

A lion's share of the inflows is likely to be lapped up by IndusInd Bank at $290 million followed by Suzlon at $264 million and Persistent Systems at $254 million, the report said. The remaining stocks could see inflows between $227 million and $160 million in the pecking order.

The rejig exercise will also see inclusions and exclusions happening in the MSCI Smallcap Index. Two dozen stocks will likely be added to the index while a dozen stocks are expected to exit this index.

The entrants include Gokaldas Exports, SJVN, Hindustan Construction Company, Ptc India, Gateway Distriparks, Arvind Fashions, Electrosteel Castings, DB Realty, Orient Cements, Gabriel India, Astra Microwave, Lloyds Engineer among others.

Meanwhile, other notable exclusions from the MSCI Smallcap Index are Jindal Stainless, Dalmia Bharat, Vodafone Idea, BHEL, Linde India, Thermax, ACC, Indian Bank and Escorts Kubota.

The Nuvama research report noted that IndusInd Bank decreased its foreign shareholding to 62.6%, meeting the minimum headroom requirement of 15%. "This development is expected to pave the way for its inclusion with a 0.5 factor in the November 2023 review," the brokerage said. IndusInd Bank's - a Nifty stock - inclusion event was widely anticipated and some of the impact has already been factored into the stock price, the note said further.

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