Special pre-open session in RIL Thursday: How will it impact Nifty 50?

economictimes.indiatimes.com:

Reliance Industries stock on Thursday, on account of the demerger of the financial services business of the company.RIL has fixed July 20 as the record date to determine eligible shareholders for the allotment of shares of the demerged entity. Under the demerger scheme, RIL shareholders will get 1 share of the demerged entity Reliance Strategic Investments for every 1 share held by them in the conglomerate. In RIL, the NSE will conduct a special pre-open session from 9 AM to 10 AM.

This means, normal trading in RIL shares will take place post 10 AM. Given a delayed trading in RIL, computation of Nifty 50 index level will be based on 49 stocks during the pre-open session. In April, NSE had revised guidelines for considering corporate actions such as mergers and demergers in index stocks.

Under the new rules, the demerged entity of an index stock will be temporarily added to the index if the exchange conducts a special pre-open session for the demerging stock. ETMarkets explains how the index computation will happen in such a situation:How will index level be computed? During the special pre-open session in RIL, Nifty50 index value will be calculated using the available prices of 49 stocks, the previous day closing price of RIL, and zero value of Jio Financial. After the closure of the special pre-open session, the discovered price of RIL and the indicative price of Jio Financial would be calculated simultaneously.