The bourse is also making changes to its Nifty Next 50 and Nifty IT indices.
Earlier this month, NSE replaced Shree Cement with Adani Enterprises in the benchmark Nifty 50. Domestic passive funds such as index funds and ETFs replicate their portfolios according to the stock weights on these indices. These funds must buy or sell stocks if their weight in the index is increased or reduced in the benchmark.
Shree Cement, , Foods, , and , among others, will see an outflow between $26 million and $56 million, according to Edelweiss.
“The capping factor of stocks in all the NSE indices is realigned upon a change in equity, investible weighted factor, replacement of scrips and periodic rebalancing,” said Abhilash Pagaria, analyst, Edelweiss Alternative & Quantitative Research.