Nuvama expects HDFC Bank, ICICI Bank to see outflows from SEBI's new eligibility rules for stock indexes

ICICI Bank

31/10/2025 07:18

** India's top lenders HDFC Bank HDBK.NS and ICICI Bank ICBK.NS to see fund outflows due to regulator's new eligibility criteria for non-benchmark indexes having derivatives contracts

** Indexes to have minimum 14 constituents, weight of top constituent capped at 20% vs 33% currently, top 3 constituents capped at 45% vs 62% currently

** Changes to primarly impact the Nifty Bank .NSEBANK index, says Nuvama Alternative & Quantitative Research

** HDBK and ICBK hold 28.49% and 24.38% weight in NSEBANK; stocks down nearly 1% on the day

** HDBK and ICBK can see outflows worth $296.1 million and $199.5 million in four tranches beginning December, due to reduction in weight, assuming 2 new stocks are added to Nifty Bank, per Nuvama

** SBI SBI.NS, Axis Bank AXBK.NS and Kotak Bank KTKM.NS can also see some outflows

** YES Bank YESB.NS and Indian Bank INBA.NS likely to be included; rise 3.8% and 1.5%, respectively

** Union Bank of India UNBK.NS and Bank of India BOI.NS can also make it to the index if NSE decides to add four more stocks

Expected flows after India's Nifty Bank rejig (Assuming two inclusions) https://reut.rs/47tFCiw

Expected flows after India's Nifty Bank rejig (Assuming four inclusions) https://reut.rs/3Jv6SVZ

 (Reporting by Vivek Kumar M)

 ((VivekKumar.M@thomsonreuters.com;))