MSCI index rejig adds Paytm, IndusInd Bank, Persistent Systems, excludes none from India

No exclusions were done from the MSCI India index.

IndusInd Bank, Suzlon Energy, Persistent Systems and Paytm parent One97 Communications were among nine stocks to enter the MSCI Global Standard Index following a recast by Morgan Stanley Capital International (MSCI) on November 15. No Indian stocks were excluded from the index this time.

In addition, IDFC First Bank, Max Health, Paytm, Polycab, PFC, REC and Supreme Industries have been included in the MSCI India Domestic Index. The adjustments will come into effect from market close on November 30.

Post the rebalance, India's stock count will rise to 131, and its weights are set to move close to 16.3 percent, compared to the current 15.9 percent. "India's representation in the EM index will reach an all-time high, marking a significant increase over the past three years, almost doubling its weight," Nuvama Alternative & Quantitative Research highlighted in a note.

According to Nuvama Alternative & Quantitative Research, IndusInd Bank's foray into the MSCI Standard Index will usher inflows worth $290 million into the counter, while Suzlon Energy may drive home $264 million.

Not just that, the addition of Persistent Systems could also attract flows $258 million while it could be $163 million for Paytm.

The inclusion of APL Apollo, Polycab, Macrotech Developers, Tata Motors DVR and Tata Communications could attract inflows of $227 million, $190 million, $183 million, $173 million and $160 million, respectively, the Nuvama report stated.

Suzlon Energy has been on a roll this year, surging around 265 percent in 2023 so far which had fueled expectations of its probable addition to MSCI Global Standard index. Post the inclusion, the stock is also likely to be classified as a mid-cap stock, an upgrade from its current small-cap status by the Association of Mutual Funds in India (AMFI).

Meanwhile, anticipation of an inclusion to the MSCI index had also triggered strong buying in the shares of IndusInd Bank, thanks to heightened interest from FIIs who closely track the global index. As a result, the stock rose around 3 percent in the past week.

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