The biggest impact, according to a Morgan Stanley note, is going to be for Bandhan Bank, which raised the FII limit to 49 percent in October 2019.
The MSCI India Index Review is due on February 12 and global brokerage Morgan Stanley expects a few changes in the index. Bandhan Bank, UltraTech Cement and HDFC Life Insurance, among others, will be impacted due to the changes, according to the brokerage.
The MSCI Index Review will be announced at late night on February 12 and the impact will be seen the next day.
The biggest impact, according to a Morgan Stanley note, is going to be for Bandhan Bank, which raised the foreign institutional investors (FII) limit to 49 percent in October 2019. Following the move, the promoter holding has gone down to 61 percent from 82 percent.
This means the free-float of Bandhan Bank has gone up and Morgan Stanley expects that the weightage of Bandhan Bank in MSCI is likely to go up by at least 32 basis points (bps) to 35 bps.
This could lead to passive inflows of close to $102 million.
According to the brokerage, UltraTech Cement is expected to see buying of close to $54 million, while HDFC Life could receive close to $48 million. Shriram Transport Finance might see the weight getting halved and would see an outflow of close to $74 million.
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