HDFC down 5% as MSCI reduces its weightage

Mumbai: Shares of housing finance lender HDFC Ltd today fell more than 5 percent amid reports that the company’s weightage is being revised to nearly half on the MSCI Index.

While the company said the methodology for calculating the weightage was wrong, the shares of the company fell 5.31 percent to an intra-day low of Rs 610.70 on BSE, and was the second worst performer on the 30-share sensitive index Sensex. On the National Stock Exchange the stock fell 5.39 percent to its day’s low of Rs 610.50.

[caption id=“attachment_311149” align=“alignleft” width=“380” caption=“HDFC housing finance said that there is some error in the calculation of weightage and the company is communicating the same to Morgan Stanley.”]  [/caption]

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The weightage of India’s biggest mortgage lender has been reduced from 6.2 percent to 3.2 percent in the MSCI index, effective from 31st May.

The company however, said that there is some error in the methodology used for calculation of weightage and the company is communicating the same to Morgan Stanley.

When contacted, an HDFC spokesperson said, “MSCI may be considering foreign availability (shares that overseas investors can buy) in HDFC at 74 percent which is wrong. It should be 100 percent. We are communicating this error to Morgan Stanley.”

MSCI made some changes in the constituents for the MSCI Global Standard Indices which will take place as of the close of 31st May, this year.

Accordingly, MSCI India index will have three additions Bank of Baroda, Cairn India and Godrej Consumer Products, while Suzlon Energy will be deleted from the index.

PTI