Midcap carousel readies for September reshuffle spin in Nifty 150

Fresh entrants like Swiggy and Dabur step in as others exit, setting ₹1,800 crore in trades in motion

The Nifty Midcap 150 index, which tracks the performance of India’s midcap stocks, is set for a major reshuffle this September. Analyst Brian Freitas of Periscope Analytics, writing on Smartkarma, projects 11 changes to the 150-company index that will trigger round-trip trades worth nearly ₹1,800 crore. But the actual churn could be much larger, given the ₹3.8 trillion in assets under management (AUM) by actively managed funds benchmarked to the index.

 

 Likely additions include ICICI Prudential Life Insurance, Dabur India, Swiggy, Hero MotoCorp, and HDB Financial Services. Meanwhile, Ola Electric, Aditya Birla Fashion and Retail, Mangalore Refinery and Petrochemicals, and Star Health Insurance may be dropped.

 

Hero MotoCorp and IndusInd Bank could enter the Nifty Midcap 150 if they fall out of the Nifty 50, while ICICI Prudential Life, Dabur, and Swiggy’s entry is linked to a possible removal from the Nifty Next 50. As a result, inflows into the Nifty Midcap 150 may only partly offset the selling pressure from their exclusion from the higher-tier indices, which command larger AUM. 

   

Among existing constituents of the Nifty Midcap 150, Max Healthcare Institute is a possible entrant to the Nifty 50, while Solar Industries India, Mazagon Dock Shipbuilders, and Union Bank of India are candidates for inclusion in the Nifty Next 50. Though these stocks will face outflows from passive funds due to their exit from the Nifty Midcap 150, the inflows from joining the Nifty 50 or Next 50 are expected to outweigh those losses.

   

Typically, stocks added to an index tend to outperform those removed.

   

The review period for the September rebalance of the Nifty Midcap 150 ran from February 1 to July 31. NSE Indices will announce the changes on September 1, with implementation scheduled after market close on September 29.