Nifty rejig today: Trent, Bharat Electronics top candidates
Trent (TRENT), a subsidiary of Tata Group, and Indian public sector aerospace and defence electronics company Bharat Electronics (BHEL) may find a place in the Nifty 50 index in the Index Maintenance Sub-Committee meeting to be held on August 23, according to JM Financial. LTI Mindtree (LTIM) and Divis Laboratories (DIVI) are likely to be excluded, it said.
The Nifty 50 index is reviewed twice a year, based on six-month data ending January 31 and July 31. The index represents 50 stocks based on free-float market capitalization and liquidity, with an average impact cost of 0.50% or less for 90% of the observations for a basket size of Rs 10 crore. The next index reshuffle will be effective from September 30.
The report mentioned that for September rebalancing, based on average free float market cap that prevailed between February 1 to July 31, the above-mentioned changes are expected.
In August so far, the share price of Trent has surged by 17.1% whereas for Bharat Electronics went down by 3.6%. For LTIM and DIVI, the share price went up by 1.6% and down by 0.8% respectively in the said period.
After the index reshuffling, Trent and Bharat Electronics are expected to receive flows of 523 $ million and 394 $ million respectively. On the other hand, LTI Mindtree and Divis Laboratories are expected to witness outflows of 205 $ million and 221 $ million respectively.
The report also mentioned that Jio Financial and Zomato have an average free float market cap higher than Trent and Bharat Electronics but they are not
