Last Updated on Dec 27, 2021 by Aradhana Gotur

State-run Bank of Baroda could replace RBL Bank in Nifty Bank Index as per Edelweiss Alternative Research—a pre-emptive analysis of the Semi-Annual Index Rejig of Nifty Indices—report. The official announcement of the shuffle will be made in the second half of February 2022.

What happened with RBL Bank?

Earlier today, RBL Bank had plunged 20% to its 52-week low of Rs. 138 apiece on the BSE. The stock fell following the bank’s exchange filing, which revealed that it’s MD and CEO was on leave, and the RBI had appointed Yogesh K Dayal as an Additional Director of the entity.  

Reshuffling in RBL Bank’s board

Yogesh Dayal will serve as an Additional Director on the RBL’s board for 2 yrs till 23 December 2023 or till further orders, whichever is earlier. The board also accepted Vishwavir Ahuja’s request for medical leave and appointed existing Executive Director Rajeev Ahuja as the Interim Managing Director and CEO of the bank. The appointment is, however, subject to regulatory and other approvals.

RBI clarification – RBL Bank’s finances are in good health

Panic spread among shareholders and dispositors following the above news and certain speculations relating to RBL Bank’s financial health. However, the RBI intervened and clarified that the bank is well capitalised and that its financial position remains stable.

Today, RBL Bank Limited closed at over 18% low at Rs. 141.60 per share on the NSE.

Nifty Bank constituents

Currently, the Nifty Bank Index consists of:

Nifty 50 – IOCL out?

In Nifty 50, Apollo Hospitals or Info Edge is likely to replace Indian Oil.

The research said, “As per our calculations, using the 4 months of existing Free Float Market Cap and hypothetical assumption of future seven weeks Market cap (avg market cap of last 10 days is assumed till Jan 22 end), we believe that APHS holds slightly higher chance than Info Edge to replace IOCL in the Nifty50. Currently, both the stocks are 1.5x above Indian Oil’s Free Float Market cap”.

However, the report also said that IOCL could remain a constituent of the Nifty 50 benchmark index if it sees a significant price rise of 12-15% in the next three weeks and successfully maintains it until the cut-off date. Likewise, Apollo Hospitals and Info Edge should also retain their current price with limited slid till the cut-off date.

Aradhana Gotur
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