MSCI review: HAL, Ashok Leyland to be added to India Standard Index; shares rise

Both Ashok Leyland and Hindustan Aeronautics qualify on size and liquidity criteria till 23 March, 2023, brokerage Emkay said in a note, adding it doesn’t expect any exclusions at this point of time.

“We have assessed the probable changes to the MSCI India standard Index assuming price cut-off date of 23rd Mar 2022,” it said.

All changes to its widely followed stock indexes will be implemented on 1 June, 2023.

HAL, Ashok Leyland shares

HAL free-float market capitalisation could increase by 3.5 per cent (from 20.5k cr to 23.8k cr) after its OFS in March. If the price stays above 2370-2400 in next 2 months, there is a high probability of its inclusion in the MSCI India Index, Emkay said.

The stock has price support at 2347 (200-DEMA) and 2290 (February 23 low). The expected inflow on inclusion would be $102mn (3.9 times ADV).

Ashok Leyland has been trading in a broad range from 135-150 since last 6 months. At the lower level of this range, the stock qualifies marginally on the size criteria.

Therefore, until the Auto stock remains at these levels, the brokerage said that it would remain a low probability inclusion candidate. The expected inflow on inclusion would be $104mn (5 times ADV).

Shares of HAL rose nearly 4% to ₹2,593.10 apiece on the NSE in Friday’s trade. Meanwhile, the stock of Ashok Leyland Ltd surged 0.91 per cent to ₹138.55 apiece.

The $5 billion iShares MSCI India Exchange-Traded Fund, the largest US-listed India-focused ETF, rose as much as 0.49 per cent to ₹38.72 on 23 March, but declined 7.59 per cent year to date.

The views and recommendations made above are those of individual analysts or broking companies, and not of Mint.