Max Healthcare, InterGlobe Aviation shares slip despite Nifty 50 inclusion

Indigo and Max Health will join the Nifty 50 from September 30.

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Shares of Max Healthcare Institute and InterGlobe Aviation are in focus in trade on Monday, August 25, after the National Stock Exchange (NSE) announced that the stocks were slated to join the benchmark Nifty 50 index. On the flip side, IndusInd Bank and Hero MotoCorp are set to be excluded from September 30 as a part of the semi-annual index reshuffle.

At 11.15 a.m., shares of Max Health were lower by 1.7 percent on the NSE, while Indigo shares were down half a percent. On the flip side, IndusInd Bank and Hero MotoCorp traded with gains.

The NSE reviews the composition of the Nifty 50 twice a year, based on the average free-float market capitalisation of stocks during the six months ending January 31 and July 31. The changes take effect in March and September.

To decide the stocks that enter the Nifty 50 index, NSE looks at the average free-float market capitalisation for the six months. Free-float market cap refers to the market value of shares readily available for trading by the public, excluding promoters' holdings and other restricted shares.

Adjustments to the index typically trigger portfolio rebalancing by exchange-traded funds (ETFs) that track the Nifty 50, often leading to significant inflows or outflows for the affected stocks. Brokerage firm Nuvama estimated that Max Healthcare could see passive inflows of around $400 million following its inclusion.

NSE has also reshuffled the Nifty Next 50 index, bringing in Hindustan Zinc, Mazagon Dock, Siemens Energy and Solar Industries. At the same time, InterGlobe Aviation, Swiggy, Dabur and ICICI Prudential Life Insurance will make way.

The changes take effect from September 30. InterGlobe Aviation exits the Nifty Next 50 as it moves up to the Nifty 50, while Dabur, ICICI Prudential and Swiggy are being dropped following their removal from the Nifty 100 index.

Shares of Hindustan Zinc, Mazagon Dock, and Siemens Energy India were in the positive zone, while Solar Industries was 0.8 percent lower. While exiting firms Dabur and ICICI Pru Life were in the positive zone, Swiggy traded with losses.

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