Bharti Airtel Up 5% On Possible Weightage Increase In MSCI Index

On Friday, shares of Bharti Airtel Limited rose 5% to Rs 610.65 after global index provider MSCI said that the stock will be a part of its February 2021 quarterly index review.

"The proforma FOL (foreign ownership limit) and upward movement of the adjustment factor due to foreign room will be implemented as part of the upcoming February 2021 Quarterly Index Review," said MSCI on Thursday.

The MSCI quarterly review will be announced on 9 February and changes will be effective from 1 March.

As a reminder, MSCI reviews Foreign Ownership Limit (FOL) and the foreign room until the price cutoff date on a quarterly basis.

On Tuesday, the company informed of receiving approval from the Department of Telecommunications to increase its foreign investment limit to 100% of the paid-up capital of some of its subsidiaries.

Accordingly, NSDL updated the foreign investment limit for Bharti Airtel to 100% from 49%.

Post revision of its foreign investor limit, Bharti Airtel's weightage in MSCI should go up, resulting in significant inflows into the stock, said ICICI Securities in a note.

The brokerage also expects the telecom operator to lead subscriber addition in the October-December quarter aided by Vodafone Idea's churn and challenges faced by the new operator due to farmer's protest.