IRFC, UTI AMC likely to get added in FTSE indices during rebalancing

State-owned Indian Railway Finance Corporation (IRFC) and UTI Asset Management Company (AMC) are likely to get included in FTSE global indices during their quarterly rebalancing later this week.

“In terms of fresh inclusions, we expect IRFC to get included in the All World and All Cap index and also expect UTI AMC to get included in the All Cap (Small Cap) index,” said Sriram Velayudhan, Vice President at IIFL Securities in a note.

China-based Fosun Pharma-led Gland Pharma also meets the qualification criteria, but limited room for overseas investment could spoil its chances.

The quarterly adjustments to FTSE global equity indices will be announced on May 21 and the changes will become effective from June 18.

During the quarterly view, only companies that get listed by way of IPOs or demerger are considered.

Velayudhan said the review will be an important one from overall market point of view.

“The review assumes importance as it will be the fourth and the final round of India revised float factor implementation. The rebalancing should see net inflows of $850 million into India as the index provider implements last round of new float factors on the back of revised FPI limits for Indian stocks,” he said.

Global index providers FTSE and MSCI had increased the weightage for several domestic stocks in their indices after a move by the government in April 2020 increased investment legroom for foreign portfolio investors (FPIs).