The Nifty 50 index is generally rebalanced every quarter and semi-annually. As a part of its periodic review, the next rebalancing of Nifty is about to take place in August 2022 which will be effective from September 30th, 2022.
These changes will take into account the average Free Float (FF) market capitalisation for the period of February to July 2022. In the upcoming semiannual readjustment of the Nifty50 index, one of the most buzzed stocks of the year, Adani Enterprises is likely to replace Shree Cement, as per a report published by the domestic brokerage firm ICICI Securities.
The key requirements for inclusion in the Nifty 50 are that the company should be part of the Nifty100, should be traded in the futures and options (F&O) market, and average free-float market capitalization should be at least 1.5 times the smallest component. Shree Cements has the lowest weightage in the index with 0.28% with a free float market capitalization of ₹ 21 thousand crores.
“The changes will take into account the average free float (FF) market capitalisation for the period Feb’22-Jul’22. While three stocks have qualified on free-float market capitalization criteria, Adani Enterprises edges out in terms of being in the F&O list and is the most likely candidate to replace Shree Cement,” the note from ICICI securities stated.
As of 11:55 AM IST, the multi-bagger stock Adani Enterprises Limited was trading at ₹ 2,837, up marginally 0.81% for the day. In a month the stock price has climbed more than 20% and so far this year in 2022, it has risen by 66% YTD.
Gautam Adani-led Adani Enterprises is a holding company, which is primarily engaged in the mining and trading of coal and iron ore on a standalone basis and acts as an incubator for Adani Group’s new business ventures.
In the previous quarter, Indian Oil Corporation Limited was replaced by Apollo Hospitals Enterprise Limited is to be a part of the index which came into effect on March 31st, 2022.
Written by Anoushka Roy
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