FII stake in HDFC Bank falls below 55%, ADRs rally on likely inflows
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American Depository Receipts (ADRs) of HDFC Bank rallied more than 3.5% in early trading on the New York Stock Exchange Tuesday driven by expectations that its weighting on the MSCI Standard Index could double in the August reshuffle. This anticipation follows a decline in foreign investors' stakes to below 55% in the June 2024 quarter. The change in MSCI weighting could potentially lead to an inflow of up to $4 billion from passive funds, analysts' estimates showed. Legroom for foreign holding in the bank has now gone up to 25.9%, against the MSCI requirement of 25% for increasing the weighting. "Currently, HDFC Bank's weighting in the MSCI EM Index is around 3.8%. After the rejig, this could jump to 7.2-7.5%, potentially bringing in $3.2 billion to $4 billion in inflows," said Abhilash Pagaria, head - Nuvama Alternative & Quantitative Research. On the NSE, shares of the bank had closed at ₹1,728 after a gain of...