The National Stock Exchange will remove Indiabulls Housing Finance from the benchmark Nifty index and will replace it with Nestle India. The changes in the index would come into effect from September 27.
Indiabulls Housing Finance has seen a massive fall in its valuation with its stock price falling from ₹1,300-levels a year back to ₹457 on Wednesday. Incidentally, housing finance entities and non banking finance companies (NBFCs) have been in the midst of a liquidity crisis in the last few months.
Meanwhile, Nestle India, which sells milk, noodles, coffee, chocolate and breakfast cereals, among other food items, has seen its share price jump nearly 13% in the last three months. On Wednesday, Nestle India shares gained 0.33% to close at ₹12,514.70 on the BSE.
An inclusion in the indices, especially the benchmark Sensex and Nifty, typically attracts investment in the stock from passive funds who mirror the index constituents in their funds.
This is the first revision of the Nifty after the exchange approved the inclusion of permitted category companies — entities that are not directly listed on NSE — in the indices. Nestle India falls under the permitted category of companies on the NSE.
