India's weightage climbs to record high on MSCI Global Standard index

India's weightage in the index has nearly doubled since November 2020

MSCI rebalancing could see addition of three Indian stocks, two deletions

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Index provider MSCI raised India's weightage in its Global Standard (Emerging Markets) index to a historic high of 18.2 per cent following its February review, and the changes will come into effect after market close on Feb. 29.
India's weightage in the index has nearly doubled since November 2020.
The climb can be attributed to India's standardized foreign ownership limit (FOL) in 2020, the sustained rally in domestic equities and relative underperformance of other emerging markets, especially China, Nuvama Alternative & Quantitative Research said in a note.
India has the second-highest weightage in the MSCI Global Standard index, after China.
With consistent flow from domestic institutional investors and steady foreign portfolio investors' participation, there is potential for India to surpass a 20 per cent weight in the MSCI Global Standard index by early 2024 itself, Nuvama added.
MSCI added five Indian stocks to its Global Standard index with no deletions in its February review. In contrast, the index provider deleted 66 Chinese stocks while adding five.
State-owned lenders Punjab National Bank and Union Bank of India were added to the large-cap index, while Bharat Heavy Electricals and NMDC were included into the mid-cap index. GMR Airports Infrastructure was moved to the mid-cap index from small-cap.
According to Nuvama Alternative & Quantitative Research, India could witness up to $1.2 billion FPI passive inflows to the standard and small-cap indexes after the February review.
(Reporting by Bharath Rajeswaran in Bengaluru; Editing by Sherry Jacob-Phillips)

(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)

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First Published: Feb 13 2024 | 8:19 AM IST

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