HDFC Bank’s merged entity may see $150-200 million outflows in MSCI; here’s why

MSCI is planning to add HDFC Bank to the largecap segment of MSCI Global Standard Indexes with an adjustment factor of 0.5, instead of the expected 1, leading to a potential outflow of up to $200m instead of an inflow. HDFC Bank’s addition would have resulted in an additional inflow of around $3bn. HDFC Bank and HDFC shares lost 5.56% and 5%, respectively, after the announcement. On the other hand, HDFC Bank posted an YoY increase of 20% in net profit for the quarter ended March 31, 2023, at Rs 12,047 crore.