The National Stock Exchange (NSE) will remove two more Anil Dhirubhai Ambani Group companies namely Reliance Communications and Reliance Power from its S&P CNX Nifty with effect from April 27, 2012. Earlier it had removed Reliance Capital.
The decision for these changes were announced by the India Index Services & Products Ltd, a joint venture of NSE and Crisil, which manages the various indices at the exchange.
Earlier last year, RCOM (Reliance Communications) and Reliance Infra, another company from Anil Ambani-led Reliance group, were excluded from the BSE's Sensex index with effect from August 8.
In the same month, NSE also announced Reliance Capital's exit from its Nifty index with effect from October 10, 2011.
However, the exit of these companies from the two benchmark indices does not seem to have had any negative impact on their share prices, and on the contrary, the stocks have rallied smartly since then.
Commenting on the development, a Reliance Group spokesperson said, "The bi-annual replacement of stocks in the Nifty is purely an outcome of the average value of free float, and not any other consideration."
"Reliance Power and Reliance Communications have significantly high promoter group holdings of approximately 80% and 70% respectively, leading to relatively lower value of the average free float over the past 6 months.
"Based on the likely increase in quantum and value of free float over a period of time, we expect both these stocks to once again be included in the Nifty at an appropriate time in the future," he added.
IISL also said that the changes have been made in various indices as part of a periodic review and they would become effective from April 27, 2012.
The other changes are inclusion of RCOM and R-Power into the Nifty Junior index, along with Divi's Laboratories, GlaxoSmithkline Consumer Healthcare and Petronet LNG.
Housing Development and Infrastructure Ltd (HDIL), IFCI, Indian Overseas Bank, Asian Paints and Bank of Baroda would be excluded from the Nifty Junior index.
Besides, changes have also been made in CNX 100, CNX 200, S&P CNX 500 Index, CNX Midcap Index, CNX Smallcap Index, Nifty Midcap 50 Index, CNX Auto Index, CNX Bank Index, CNX Consumption Index, CNX FMCG Index, CNX IT Index, CNX Infrastructure Index, CNX Metal Index and CNX Realty Index.
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