Nifty semi-annual rejig: Reliance, Infosys expected to see highest outflows

The semi-annual rebalance of Nifty indices is scheduled on March 29, and a series of stocks will see inflows and outflows as per the rejig. The rebalancing will take effect from March 31.

The NSE rebalances its indices twice every year, and owing to this rejig, certain stocks will be replaced by others and see an exit.

According to Nuvama Institutional Research, after the rejig, Reliance Industries (RIL), Infosys, ICICI Bank, and HDFC Bank, among others, are expected to see the biggest outflows.

The predicted outflows from RIL, India's largest company by market cap, could be $42 million, followed by $39 million from Infosys. Meanwhile, HDFC Bank and ICICI Bank are expected to see outflows worth $16 million and $13 million, respectively.

Maximum net inflows, as per the analysis of Nuvama, could be seen in Page Industries, Canara Bank, SBI, Axis Bank, and Coal India, among others.

Here's a detailed breakdown of expected outflows and inflows of Nifty indices after rebalancing:

Nifty 50 ETF
In the Nifty50 index, Kotak Mahindra Bank (+ $18 million), HDFC (+ $17 million), Axis Bank (+ $14 million), HDFC Bank (+ $14 million), and ICICI Bank (+ $13 million) are expected to see a weight up, while RIL (- $42 million), Infosys (-$39 million), M&M (-$24 million), Bharti Airtel (-$11 million), and Cipla (-$4 million) are expected to a see a weight down.

Nifty Bank
In the Nifty Bank pack, due to the weight down, HDFC Bank, ICICI Bank, and Kotak Mahindra Bank are expected to see outflows of $31 million, $26 million, and $7 million, respectively. On the other hand, SBI, IndusInd Bank, and Axis Bank are among the stocks that will see their weightage going up in the index, resulting in potential inflows.

Nifty Next50
Starting this time, the Nifty Indices have modified the methodology, and due to this, the cumulative weight for non-F&O stocks in the Next 50 Index will move from 15% to 10%.
This change could lead to some weight reduction in non-F&O members like Adani Total Gas, Adani Transmission, Adani Green, DMart, Bajaj Holdings and Investments, Nykaa, Life Insurance Corporation (LIC), Procter & Gamble, and Zomato.

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