Nuvama Sees Mamaearth Getting Included In MSCI Smallcap Index, Nykaa In Global Standard Index

Paytm Removed From MSCI India Index Amid Declining Market Cap, PB Fintech Added

SUMMARY

Honasa is among the top contenders for being included in the index, along with IREDA, Cello World, and Signature Global, according to Nuvama

Nuvama sees possibilities of Nykaa, along with the likes of Canara Bank, Mankind Pharma, Bosch and Vodafone Idea, making it to the MSCI Standard index if they rally between 8-20%

The upcoming MSCI index rejig is scheduled for an official announcement on February 13 while the adjustments are set to happen on February 29

Honasa Consumer, the recently-listed parent entity of beauty and personal care D2C startup Mamaearth, is likely to make it to the MSCI Smallcap index, according to Nuvama Alternative & Quantitative Research.

The stock is among the top contenders for being included in the index, along with IREDA, Cello World, and Signature Global, the brokerage reportedly said. As per a Moneycontrol report, Nuvama has projected Jaiprakash Associates, Protean e-gov, Swan Energy, J Kumar Infraprojects, and RattanIndia Power as the other probable inclusions to the MSCI Smallcap index, given all these stocks have rallied between 10-100% in the last three months. The rally has made their free float-adjusted market capitalisation eligible for the inclusion.

Mamaearth made a muted debut on the bourses in November but the stock has rallied 37% since then.

The upcoming MSCI index rejig is scheduled for an official announcement on February 13 while the adjustments are set to happen on February 29.

During the previous adjustments made in November, Paytm’s parent One97 Communications was among the nine stocks to be incorporated into the MSCI Global Standard Index.

Now, Nuvama also sees possibilities of Nykaa’s parent FSN E-Commerce Ventures, along with the likes of Canara Bank, Mankind Pharma, Bosch and Vodafone Idea, making it to the MSCI Standard index if they rally between 8-20%.

Meanwhile, Nuvama has also noted that even if a few names don’t make it to the MSCI Global Standard Index in February, they would be included during the May 2024 review.

Nuvama’s analyst Abhilash Pagaria said noted that India currently commands a 16.9% weight in the MSCI EM Index, which is expected to surpass 20% by early to mid-2024 given the current momentum in the domestic market and its outperformance compared to other emerging markets.

Nykaa gained over 12% in 2023 and shares are currently trading at INR 173.4 on the BSE. Mamaearth is currently trading at INR 444.4.