BackVodafone Idea, Nykaa, SAIL among 8 stocks likely to enter MSCI Global Standard index in August rejig, says Nuvama
Oberoi Realty, Zydus Lifesciences, Prestige Estates, Thermax, Nykaa parent FSN E-Commerce Ventures, Alkem Laboratories and Steel Authority of India (SAIL) need up to 10% rise to enter the MSCI index.
PremiumVodafone Idea shares have become qualified to be included in the MSCI Global Standard index in its August review, according to Nuvama Institutional Equities. The addition in the index is likely to attract $233 million inflows in Vodafone Idea shares.
Seven other stocks need up to 10% rise to enter the MSCI index, Nuvama Equities said in a report. These stocks are Oberoi Realty, Zydus Lifesciences, Prestige Estates, Thermax, Nykaa parent FSN E-Commerce Ventures, Alkem Laboratories and Steel Authority of India (SAIL).
These stocks need up to 10% price move on the upside to be eligible for inclusion in the MSCI Global Standard Index. The official cut-off date is the third week of July and the MSCI announcement is likely to be made on August 13.
According to Nuvama estimates, Oberoi Realty, Zydus Lifesciences, Prestige Estates and may attract inflows worth $130-137 million after their inclusion in the index.
FSN E-Commerce Ventures, Alkem Laboratories and SAIL are likely to see inflows of $127 million, $126 million and $124 million, respectively.
Meanwhile, Oil India, ACC, Oracle Financial Services Software and United Breweries shares need 10% to 20% upside to be included in the index, while Schaeffler India share price needs more than 20% rise.
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Nuvama Equities has reaffirmed its May 2024 conviction names for MSCI Global Standard Index and MSCI Smallcap Index.
“The May review will entail another action-packed rejig as we anticipate close to USD 2 billion inflow into India. The pre-emptive price action in most of the names are already factored in," said the brokerage firm.
As of April 26, 2024, India’s weight in the MSCI Emerging Market Index stands at 18%, a significant leap from just 8% in early 2020. By the second half of 2024, Nuvama anticipates crossing the 20% threshold in the EM Index.
“This remarkable achievement can be attributed to multiple factors: I) India's standardized Foreign Ownership Limit (FOL) in 2020. II) Robust performance by Indian equities, particularly in the Midcap segment, leading to numerous inclusions in every review. III) Relative underperformance by other EM packs, especially China," said Abhilash Pagaria of Nuvama Alternative & Quantitative Research.
With a consistent flow from domestic institutional investors (DII) and now if steady FII participation resumes, there is potential for India to surpass a 20% weight in the MSCI EM Index by the second half of 2024 itself, he added.
As of now, India’s stock count in the MSCI Standard Index/EM Index is 136, and it is anticipated to reach around 145 by the forthcoming May review. The official announcement will come on May 15, 2024.
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