MSCI rejig: MCX, Federal Bank and 2 others added; Hyundai Motor, RVNL among exclusions — check estimated inflows, outflows

MSCI rejig: Global index provider MSCI on Tuesday announced changes to its May 2026 index review, adding Federal Bank, Indian Bank, Multi Commodity Exchange of India (MCX) and National Aluminium Company (NALCO) to the MSCI Global Standard Index.

At the same time, Hyundai Motor India, Jubilant FoodWorks, Kalyan Jewellers India and Rail Vikas Nigam (RVNL) have been removed from the MSCI India Index, which is part of the Global Standard Index.

The changes will come into effect after the market closes on May 29, 2026.

MSCI rejigs its indices regularly to keep them updated with current market conditions. It adds companies that have grown bigger, are more actively traded or have higher public shareholding and removes stocks that no longer meet its standards. MSCI mainly looks at factors like market value, free float, liquidity and trading activity to ensure the index properly reflects the market and remains suitable for global investors and foreign funds that track these indices.

Adani Energy Solutions excluded

MSCI had initially proposed the inclusion of Adani Energy Solutions in its May 2026 review. However, the stock was later excluded after remaining under the National Stock Exchange’s short-term watchlist for unusual trading activity.

MSCI said its methodology does not allow additions to the Investable Market Index for securities placed under India’s Short-Term or Long-Term Additional Surveillance Measure lists.

India weight slips marginally

India’s weight in the MSCI Standard Index slipped marginally to 12.3 per cent from 12.4 per cent earlier. However, the total number of Indian companies represented in the index remained unchanged at 165.

The latest rejig also reflects changes in MSCI’s float calculation methodology, which altered the weightage of several stocks.

MSCI Smallcap Index sees major reshuffle

The MSCI Smallcap Index witnessed sharp changes in the May 2026 review. A total of 16 stocks were added, while 30 stocks were removed from the index. The overall number of stocks in the MSCI Smallcap Index declined to 459 from 474 earlier.

Among the notable additions were Aditya Infotech, Anthem Biosciences, Anupam Rasayan India, Bluestone Jewellery and Lifestyle, Emmvee Photovoltaic, Escorts Kubota, Fractal Analytics, Indian Renewable Energy Development Agency (IREDA), PhysicsWallah and Pine Labs.

Meanwhile, Federal Bank and MCX moved out of the Smallcap Index following their inclusion in the Standard Index.

Expected inflows and outflows

According to Zee Business Research estimates, the MSCI reshuffle could lead to significant passive fund flows in select stocks.

Expected inflows are estimated at around Rs 4,690 crore for Federal Bank, Rs 3,560 crore for MCX, Rs 2,940 crore for NALCO and Rs 1,990 crore for Indian Bank.

Other stocks likely to see inflows include Adani Power, Bharat Petroleum Corporation (BPCL) and FSN E-Commerce Ventures.

On the other hand, estimated outflows are pegged at around Rs 2,690 crore for Hyundai Motor India, Rs 1,950 crore for Hindustan Unilever, Rs 1,930 crore for Bajaj Finance, Rs 1,540 crore for Jubilant FoodWorks, Rs 1,375 crore for Tata Consultancy Services, Rs 1,300 crore for Kalyan Jewellers and Rs 1,290 crore for RVNL, as per Zee Business Research estimates.