The MSCI Index, short for the Morgan Stanley Capital International Index, is a prominent benchmark used to evaluate global equity markets. It offers investors a broad overview of stock market trends by monitoring the performance of selected stocks or industry sectors across multiple countries.
In the context of India, the MSCI Index plays a significant role in drawing foreign investment. It also acts as a performance indicator for Indian companies that are listed on international stock exchanges.
Developed by MSCI Inc., a leading firm in investment research and portfolio support services, the MSCI Index includes a diverse range of equity indices spanning both developed and emerging markets worldwide.
Investors often use this index as a reference point to evaluate the performance of their investment portfolios and to compare individual returns against overall market performance.
Inclusion of Stocks in MSCI Index
According to projections by Nuvama Alternative & Quantitative Research, four companies, Swiggy Limited, Vishal Mega Mart Limited, Hitachi Energy Limited, and Waaree Energies Limited, are expected to be added to the MSCI Standard Index during its upcoming rebalancing in August 2025.
Following the index review announcement on 8th August, these stocks are estimated to attract total foreign inflows of around $1.03 billion. As per sources, Vishal Mega Mart is likely to draw the highest inflow of around $287 million, while Swiggy may receive around $285 million. Hitachi Energy India and Waaree Energies are anticipated to see inflows of about $240 million and $217 million, respectively.
These changes are scheduled to be implemented on 26th August 2025. The MSCI Smallcap Index is also expected to see 12 new inclusions in its August 2025 review.
The potential additions include Inventurus Knowledge Solutions, Capri Global Capital, Brainbees Solutions, Lumax Auto Technologies, Belrise Industries, Transrail Lighting, Ather Energy, CSB Bank, India Glycols, Lloyds Enterprises, Yatharth Hospital, and Zinka Logistics Solutions. Together, these stocks are projected to attract a combined inflow of nearly $65 million.
Stock Exclusions from MSCI Index
Sona BLW Precision Forgings Limited and Thermax Limited are anticipated to be removed from the MSCI Standard Index. These exclusions are expected to result in significant foreign investor withdrawals, with Sona BLW seeing an estimated outflow of $186 million and Thermax facing a projected outflow of $154 million.
Meanwhile, in the MSCI Smallcap Index, four companies, Bharat Dynamics, Bondada Engineering, Hikal, and Kennametal India, are also expected to be excluded. The removal of these stocks may lead to a collective outflow of around $36 million.
Further, as per Nuvama, shares of One 97 Communications (Paytm) met the eligibility requirements for inclusion by the fourth day of the review period. However, due to an earlier cut-off date, its addition to the index is likely to be postponed until the November 2025 review.
Written by Shivani Singh
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