NSE Nifty 50 Reshuffle: Max Healthcare, InterGlobe Aviation in; IndusInd Bank, Hero out

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.

The National Stock Exchange (NSE) on Friday announced changes to its benchmark Nifty 50 index, with Max Healthcare Institute and InterGlobe Aviation, the parent company of IndiGo, set to join the index from September 30.

As part of the semi-annual reshuffle, IndusInd Bank and Hero MotoCorp will be dropped, the exchange said. 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.

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 in July that Max Healthcare could see passive inflows of around $400 million following its inclusion.

Between January and July, shares of Max Healthcare gained 9.34% and InterGlobe Aviation climbed 28.61%, while IndusInd Bank shed 17.59%. Hero MotoCorp shares advanced 1.82% over the same period. Earlier this week, InterGlobe shares touched a record high after Jefferies projected the airline’s market share gains would continue in both domestic and international markets.

IndusInd Bank, on the other hand, has faced pressure after taking a $230 million loss in the financial year ended March 31 due to misreporting in internal derivatives trades. The episode led to the resignations of CEO Sumant Kathpalia and deputy chief Arun Khurana in April.

(With inputs from Reuters)