MSCI Indices Rejig Likely This Week: Move May Benefit These Stocks

On Friday, FTSE Russell announced deferring the execution of the changes proposed to the investability weightage of its Indian constituents. "In light of the current market conditions and with India continuing to be in lockdown due to the Covid-19 pandemic which adds to the uncertainty leading into the June 2020 FTSE GEIS quarterly review, FTSE Russell proposes to delay implementation and provide an update by 30 June 2020", said FTSA in a statement.

MSCI Indices Rejig Likely This Week: Move May Benefit These Stocks

The proposed change in investability weightage of India was expected to bring reasonable FII inflow into the Indian markets.

Now this change subject to any update by June end is proposed to be implemented in the September 2020 FTSE global equities index series semi-annual review. Further as per FTSE, the increase in India's weightage in the FTSE global indices shall be brought about in 4 tranches, with initiation in September 2020 and each of the tranche will result in a 25% change.

Also, earlier this year MSCI or Morgan Stanley Capital Investment in its indexes deferred the proposed reshuffling in India's weightage. A report by Morgan Stanley said the rejig in the MSCI indexes could drive an influx to the tune of Rs. 52000 crore from foreign investors into the Indian equities.

As per a Motilal Oswal report, the revision in MSCI indexes was expected as early as May 12 and foreign investments to come in from May 29. And some of the stocks which the brokerage firm expects to benefit the most once the rejig becomes effective in terms of foreign funds are Kotak Mahindra Bank, MRF, L&T, and NTPC.

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