Bank of Baroda likely to replace RBL Bank in Nifty Bank Index: Report

RBL Bank Limited, which is in the news after the Reserve Bank of India (RBI) made some big changes at the management level, could be excluded from Nifty Bank index. The assumption is based on a research report by Edelweiss.

This came to the fore after Edelweiss Alternative Research did a pre-emptive analysis of the Semi-Annual Index Rejig of Nifty Indices, which will officially be announced in the second half of February 2022. As per the research report, Bank of Baroda (BoB) is the top contender for replacing RBL Bank from the 12-share Nifty Bank.  

Currently, Nifty Bank Index comprises Kotak Bank, ICICI Bank, Punjab National Bank, HDFC Bank, Axis Bank, Federal Bank, State Bank of India, IndusInd Bank, IDFC First Bank, Bandhan Bank, AU Small Finance Bank and RBL Bank.  

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As per the report, BoB will replace RBL Bank. "RBL Bank (RBK), an existing constituent will most likely be replaced by Bank of Baroda (BoB) in Nifty Bank Index," said Edelweiss Alternative Research.  

Source:Edelweiss Research Report

IOCL may be replaced by Apollo Hospitals or Info Edge in Nifty 50

In the benchmark Nifty 50, Indian Oil (IOCL) is most likely to be replaced by Apollo Hospitals (APHS) or Info Edge (INFOE).  

"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," said the research.  

It, however, a significant price rise (appx 12-15%) in the next 3 weeks which if maintained till cut-off date can save IOCL from the exclusion. Similarly, the two potential names should also hold the current price with limited slid till cut-off dat, it said.  

RBL Bank shares close 18% lower on BSE

Meanwhile, shares of RBL Bank Limited on Monday closed with over 18 per cent loss to Rs 140.90 per share on the BSE.  

Earlier, the shares tanked 20 per cent to 52-week low of Rs 138 apiece on the BSE after the management in an exchange filing said that the Bank's MD and CEO had gone on a leave and the Reserve Bank of India (RBI) had appointed Yogesh K Dayal as an additional director of the bank.  

Reshuffling in RBL Board
"The Reserve Bank of India has appointed Yogesh Dayal as an Additional Director on the Board of the Bank for a period of two years till December 23, 2023 or till further orders, whichever is earlier. The Board accepted the request of Vishwavir Ahuja to proceed on medical leave and appointed Rajeev Ahuja (existing Executive Director of the Bank) as the Interim Managing Director & CEO of the Bank subject to regulatory and other approvals," read a statement from the Bank updated on the BSE.  

RBI clarification 
Later after panic spread among shareholders and dispositors, the RBI too came with the clarification. "There has been speculation relating to the RBL Bank Ltd. in certain quarters which appears to be arising from recent events surrounding the bank. The Reserve Bank would like to state that the bank is well capitalised and the financial position of the bank remains satisfactory," said the RBI.  
It further said that there is no need for depositors and other stakeholders to react to the speculative reports. "The bank’s financial health remains stable," it added.