The Nifty semi-annual rebalancing kicks in today and the Nifty-50 Index will see a cumulative inflow of Rs 7,834.29 crore from new entrants Zomato and Jio Financial Services, according to a report by Nuvama Alternative and Quantitative Research.
At the same time, the exclusion of Bharat Petroleum Corp and Britannia from the 50-stock index will result in an outflow of Rs 1,937 crore and Rs 2,048.96 crore, respectively. The report said this makes Thursday an ‘action-packed’ day as it coincides with the weekly derivatives expiry.
Due to this, Nuvama’s earnings-per-share estimates of the Nifty-50 for the next two financial years have been lowered to Rs 1,171 and Rs 1,331, respectively, from Rs 1,186 and Rs 1,349, while price-to-earnings estimates have risen to 20.2 and 17.7 from 19.9 and to 17.5, respectively.
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According to the report, Zomato will bring in inflows of Rs 5,182.7 crore in the Nifty 50, four times ADV (average daily impact over 20-day’s average volume) and displace BPCL, which is expected to see an outflow of Rs 1,937 crore (7.1x ADV). Jio Financial Services will bring in Rs 2,651.6 crore (3.9x ADV) in the Nifty and displace Britannia, which will result in an outflow of Rs 2,048.96 crore, 12.5x ADV.
Weightage for the stocks will also change due to which major inflows will happen in Grasim (Rs 77.48 crore), Adani Enterprises (Rs 77.48 crore) and UltraTech Cement (Rs 51.65 crore). Slight weight reduction-led outflows will be seen in Bajaj Finance (Rs 680.11 crore), HDFC Bank (Rs 439.06 crore) and Reliance Industries (Rs 352.97 crore).
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