Trent may exit Sensex in June rejig; Hindalco, Shriram Finance seen as likely entrants

Tata Group retail stock Trent is likely to be excluded from the BSE Sensex in the upcoming June 2026 semi-annual rejig, according to Nuvama Alternative & Quantitative Research, with Hindalco Industries and Shriram Finance emerging as the top contenders for inclusion.

The brokerage estimates that Trent’s exclusion could lead to passive outflows of nearly $257 million from index-linked funds and ETFs. On the other hand, Hindalco could attract estimated inflows of around $366 million, while Shriram Finance may see even higher passive inflows of approximately $445 million if included in the benchmark index.

According to Nuvama’s detailed note, the adjustment is expected to take effect from June 19, 2026, while the tentative announcement date for the rejig is May 22, 2026. The market-cap cut-off date for the review was April 30, 2026.

The brokerage said Trent is expected to be removed primarily due to a relative decline in its free-float market capitalisation following recent underperformance. The note added that while Shriram Finance currently leads on free-float market capitalisation metrics, Hindalco Industries could have a relatively higher probability of inclusion because of the index committee’s preference for broader sectoral representation within the BSE universe.

Nuvama also highlighted that the final outcome remains subject to the discretion of the BSE index committee, indicating there is still some subjectivity involved in the final selection process despite the methodology framework.

Sensex reshuffles are closely watched by institutional investors because passive funds, ETFs and index-tracking strategies are required to rebalance their portfolios based on the revised composition. Stocks entering the index generally benefit from fresh passive buying demand, while excluded companies may face selling pressure from benchmark-linked funds.

The brokerage’s estimates also showed the likely trading impact relative to liquidity. The expected inflows into Shriram Finance are estimated at nearly 7.8 times its average daily traded volume impact, while Hindalco’s estimated inflows stand at around 5.5 times.

Trent has been among the standout retail performers in recent years, driven by rapid growth in its fashion and value retail businesses including Westside and Zudio. However, changing market-cap rankings and free-float dynamics can significantly influence eligibility during periodic benchmark reviews.

Meanwhile, Hindalco has remained in focus after strong commentary from Novelis and improving aluminium sector sentiment, while Shriram Finance has benefited from healthy loan growth momentum and improving investor interest in the NBFC space.

The official announcement regarding the June 2026 Sensex rejig is awaited from Asia Index Pvt Ltd, the administrator of BSE benchmark indices.

Disclaimer: This article is for informational purposes only and should not be construed as investment advice.