The Hindu Business Line : DLF will replace Dr. Reddy’s in Sensex

Mumbai, Oct. 8 DLF, the country’s largest realty firm, would be replacing Dr Reddy’s Laboratories in the Sensex from November 19 this year. The Index Committee of the BSE, in a meeting held on October 7, 2007, has decided to revise the composition of its indices.

“This refurbish is part of our periodic preview, according to our set guidelines, such as liquidity, market capitalisation etc. of stocks. And as to why a realty stock was chosen, if you look at the BSE listed universe, realty stocks constitute five per cent. DLF was definitely the largest and strongest contender for a spot in the Sensex,” said a spokesperson for the BSE.

“This revamping needed to be done, as the pharma stocks have been languishing in the past few weeks and there has been a lot of activities taking place with regard to the realty stocks,” said chief of a leading brokerage. With DLF now being listed in Group A, its value in the market will also go up, said brokers. “The inclusion of DLF will definitely bring about a boost in the performance of the already impulsive Sensex,” said Mr C.A. Prashant Bhansali, Director, Mehta Equities.

Revisions

It’s not just the Sensex that’s getting revised, but the compositions of the BSE-100, BSE-200, BSE-500 and the BSE-PSU indices are getting revised too. Companies like Idea Cellular, Patni Computer Systems and Union Bank of India would be included in the BSE-100 from October 15, 2007, said a BSE statement.

Besides, PowerGrid, Engineers India and MMTC would replace Balmer Lawrie and HMT on the BSE PSU index from November 19, 2007. The committee has made further changes to the BSE sectoral indices as well, including the induction of RNRL and Aban Offshore in the BSE Oil and Gas index; Spice Communication Ltd and GTL Ltd in the BSE Teck index; and Dishman Pharma and Ipca Labs in the Healthcare index.