Experts said the institutional flows on Monday was largely a one-off event due to MSCI buying and selling and not a change in trend
The change in the pecking order comes amid a sharp rally in China equities, while India has seen record foreign outflows coupled with earnings disappointment
In the early hours of Thursday, MSCI Inc. announced that it has included Alkem Laboratories, BSE, Kalyan Jewellers India, Oberoi Realty, and Voltas in its MSCI Global Standard Indexes
MSCI said there would be 156 Indian stocks in the index, but that is only one-fourth of China's 598, signalling scope for further inclusion of Indian stocks on the index
Kalyan Jewellers India, Voltas, and BSE were upgraded from the small cap segment to mid cap segment of the MSCI Emerging Markets Index
China's weight has fallen by half since peaking in early 2021, while India's has more than doubled during this period
India's weight in the MSCI investible large-, mid- and small-cap index has risen to 2.35 per cent, greater than China's weight of 2.24 per cent, Morgan Stanley said in a note on Tuesday
Weightage almost 70 bps higher than China
Shares of Adani Energy Solutions Ltd (AESL) at last trading session on Wednesday jumped 3.8 per cent despite the flattish markets, as the street is expecting strong inflows by the end of August from the inclusion in the MSCI Indexinflows of USD 250 million according to brokerage houses. On Tuesday MSCI announced that it has lifted Embargo' on Adani Group stocks, which means the stock is eligible for inclusion in the MSCI India Index, after removing the group company last year in late January 2023, due to uncertainty over free-float. Lifting this restriction means that any recent changes in free float plus equity raises are eligible for inclusion. Furthermore, stocks that were excluded can be included again. Earlier in August, Adani group's power transmission, distribution and smart metering company completed a USD 1 billion QIP, which has led to a significant increase in the company's free float. Adani Enterprises, another group company has also proposed fundraising of nearly USD 2
Weight surpasses 20% in the widely-followed MSCI EM index
Analysts, on their part, are of the view that long-term investors could continue to hold the stock
Stock Market Highlights on August 13, 2024: Broader indices also settled lower, with small-cap shares being the worst hit as the Nifty Smallcap 100 index fell 1.30 per cent
MSCI, which had earlier excluded Adani Energy and Adani Enterprises from the global standard index, stated it would now review the companies' fundraising activities
Analysts at Nuvama expect an inflow of $281 million in Dixon Technologies as a result, followed by Vodafone Idea at $278 million
Shares of Rail Vikas Nigam Ltd, Dixon Technologies, and OIL India among others rose up to 5 per cent after their inclusion in the MSCI India index
HDFC Bank, India's top private lender and the heaviest stock in the benchmark NSE Nifty 50, will see an increase in its weightage, triggering potential inflows of $1.8 billion, Pagaria said
HDFC Bank MSCI rebalance news: MSCI has announced that the weight of HDFC Bank will be gradually increased, in two tranches, to full weight of 1
The global index provider will announce the changes on August 13, and funds will have to adjust their positions by August 30
MSCI's broadest index of Asia-Pacific shares outside Japan lost 0.57 per cent. Australia's S&P/ASX 200 index was one of the biggest decliners
In total, there are 42 securities to be added and 121 cut from the all-country world index