Mumbai: ICICI Securities said the upcoming semi-annual changes to the Nifty wherein is likely to replace could be ‘dwarfed’ by the impact of the impending HDFC Bank-HDFC merger. The brokerage said the merger will likely result in an unprecedented 14% of the Nifty’s weight (HDFC+HDFC Bank) getting replaced by two new stocks with a combined weight of 1% and the balance 13% weight getting distributed among 48 stocks in the index.
Based on the assets under management (AUM) of Nifty-based exchange-traded funds (ETFs) of ₹1.7 lakh crore, the index changes related to the HDFC-HDFC Bank merger-could result in buying and selling of stocks worth over ₹48,000 crore based on prices as on the end of July, said ICICI Securities.
HDFC Bank said in early June that it has received the Reserve
‘s nod for its merger with parent HDFC.
ICICI Securities said the merger-related changes to the index will depend on the date of shareholders’ approval.
The upcoming semi-annual changes to the Nifty will be announced in August and the changes shall come into effect from September 30.
“While three stocks have qualified on free float market cap criteria, Adani Enterprises edges out in terms of being in the F&O (futures and options) list and is the most likely candidate to replace Shree Cement,” said the brokerage’s analysts in a client note.
The index reshuffle will result in ETF buying worth ₹1,760 crore in Adani Enterprises and selling worth ₹630 crore in Shree Cement, said ICICI Securities.
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