Hcl Tech Flares On Nifty Moves

Shares of sensex constituent HCL Technologies leaped 6.98 per cent to Rs 216.90 on the Bombay Stock Exchange (BSE) following the National stock Exchange's (NSE) announcement that it will be inducted on the S&P CNX Nifty from October 28.

On NSE, the shares closed a shade lower than BSE at Rs 216.55. Over 8.36 lakh shares were traded on BSE while NSE witnessed a volume of 20.65 lakh shares. The stock has a 2.50 per cent weightage in the sensex.

Other than HCL Technologies, Bharat Petroleum Corporation (BPCL) will also be included in the benchmark 50-issue index. Asian Paints and Procter & Gamble Hygiene Healthcare will be moved out of the index.

Shipping Corporation will replace Reliance Petroleum in the index following the refiner's merger with petrochemicals major Reliance Industries.

Generally, the index committee conducts a periodic review of the Nifty's composition. Additions or exclusions are made on the basis of certain parameters including market capitalisation, liquidity and sectoral representation.

The inclusion of the stocks should enhance their liquidity, say analysts. As it is, on January 7, HCL Technologies replaced group company NIIT on the BSE sensex.

Analysts say being on the index has a lot of advantages as FIIs and mutual funds generally invest in index-based stocks. An index component affords credibility to the company's management, expected performance etc. It also helps in changing the perspective of investors towards a stock.

For the full year ended June 30, HCL Technologies posted a 5.8 per cent fall in net profit to Rs 401.95 crore (Rs 426.78 crore) on a 2.8 per cent rise in total income to Rs 856.56 crore (Rs 833.13 crore). The company also recommended a 75 per cent dividend for FY 2001-02.

As on June 30, the promoters' held 77.2 per cent stake in HCL Technologies, while the public and institutions held 5.1 per cent and 9.4 per cent, respectively.