Shares of Max Healthcare, Sona BLW Precision Forgings, and Hindustan Aeronautics will now be included in the MSCI India Standard Index.

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The three stocks will replace Indus Towers, Adani Transmission, and Adani Total Gas, which will be excluded from the index.

The changes, part of MSCI's quarterly index review, will be effective from May 31.

As per Nuvama Alternative and Quantitative Research's preliminary calculations, India can receive net passive foreign flows of $600 million to $700 million.

Indus Towers, Adani Transmission, and Adani Total Gas will also be excluded from the MSCI India Domestic Index.

The exclusion of the Adani Group stocks comes after the MSCI lowered their free float in its review.

MSCI said that it has cut the free float of Adani Total Gas to 14 percent from 25 percent earlier, while that of Adani Transmission has been reduced to 10 percent from 25 percent.

Among those stocks that have seen an increase in weightage include Kotak Mahindra Bank, Maruti Suzuki India, ONGC, UltraTech Cement, InterGlobe Aviation, and Zomato.

While Morgan Stanley had expected inflows of around $745 million into Kotak Mahindra Bank post its weightage increase, Nuvama is projecting inflows worth $810 million.

The increase in weightage for InterGlobe Aviation (0.11 bps) and NTPC (0.09 bps) will result in potential inflows of $63 million and $54 million respectively, according to Nuvama.

Infosys, ICICI Bank, JSW Steel, HDFC and TCS are some of the stocks that have seen a reduction in weightage. Stocks that have seen a weight reduction can see potential outflows between $12 million to as much as $155 million.

14 stocks, which also include names like Anupam Rasayan, Rail Vikas Nigam, and Gland Pharma have now been included in the MSCI India Smallcap Index, while eight names like Dilip Buildcon, Thyrocare, and Vakrangee have been excluded from the same.

(Edited by : Hormaz Fatakia)

First Published:May 12, 2023 6:26 AM IST