
Ahead of the MSCI adjustments later in the day, shares of HDFC Bank Ltd are trading with slight gains on Friday.
The stock was expected to rise in weightage in the MSCI indices. However, MSCI indicated that HDFC Bank’s weightage would be increased in two tranches, as the street had assumed that the weightage would be increased all at once.
By the close of August 30, 2024, MSCI will maintain HDFC Bank in its indices, but with an increase in the Foreign Inclusion Factor (FIF) from 0.37 to 0.56.
The first adjustment will occur after the current rejig. Nuvama Alternative and Quantitative Research expects the present adjustment will result in $1.8 billion in inflows for HDFC Bank. Information on the second tranche are scheduled to be announced during the next rejig in November, assuming the FPI headroom remains at least 20%.
IIFL Alternatives also expects inflows in the first tranche of HDFC Bank’s weightage increase to range between $1.5 billion and $1.8 billion.