The stocks that were previously removed had far less weightage than the HDFC twins
The imminent merger between Housing Development Finance Corporation (HDFC
) and HDFC Bank could lead to a churn of nearly Rs 48,000 crore in the benchmark Nifty50 index. Currently, both the financial sector behemoths have considerable weightage in the 50-share index.
Closer to their effective merger date, both HDFC and HDFC Bank will be removed from the Nifty, say strategists at ICICI Securities, citing a rule around index computation methodology. The rule says any entity which undergoes a scheme of merger gets excluded from the index. In 2016, Grasim was removed from the Nifty index ahead of its merger with Aditya Birla Nuvo (ABNL). More recently, NMDC was removed from the Nifty CPSE index due to a de-merger scheme.
First Published: Aug 10 2022 | 8:14 PM IST