Nifty Plans to Shuffle its Benchmark Indices

Giving a major blow to the stakeholders, Nifty shuffled some of its major stocks listed in its benchmark index. According to the report, the stocks of ACC, Bank of Baroda, Tata Power and Tata Motors DVR will soon exit and it would be replaced by Bajaj Finance, Hindustan Petroleum Corp and United Phosphorous.

“The above replacements will be applicable to Nifty50 Equal Weight Index,” the statement reported.

How has it affected the share price?

The share price of ACC has been tanked down by 0.78%, Bank of Baroda by 2.91%, Tata Power by 2.41% and Tata Motors DVR tanked by 2.20%. On the other hand, the shares of Hindustan Petroleum Corporation, and UPL edged higher by 0.79%, 0.13%. However, an exception to the rule was Bajaj Finance that edged down by 2.75%.

Why is this major shuffle done?

It is believed a stock is replaced in a particular index because of its poor performance (Bank of Baroda), dip in financial results (ACC), decline in sales (Tata Motors DVR) or because of some corporate actions like delisting.

Now, the question arises should the investors continue to invest in these stocks or not? The answer is exclusion of stocks does have a sentimental impact, but only day traders need to worry. An average investor can invest without a doubt.