The shares of Trent, a fashion retailer, gained 3.1% to finish at a new record high of Rs 6,999. The gains come before the half-yearly Nifty indices, at which the Tata group company is expected to take over for the pharma company Divi’s Laboratories.

After chairman Noel Tata stated in an interview with a newspaper that the company has the potential to grow tenfold from its current level, the stock also saw an increase. As a result of strong financial results, Trent shares have already surged 2.4 times this year.

 In addition, the brokerage anticipates that software company LTI Mindtree will be replaced in the Nifty 50 index by state-owned Bharat Electronics (BEL).

BEL could receive Rs 3,710 crore in new funding. Divi’s Lab and LTI Mindtree, on the other hand, could see outflows of Rs 2,200 crore and Rs 1,750 crore if they were taken out of the widely followed Nifty 50 index, which is tracked by passive funds with nearly Rs 4 trillion in assets under management.

Six Tata group stocks will now be included in the 50-share index thanks to Trent’s addition to Nifty. Nifty is currently made up of Tata Consultancy Services (TCS), Tata Motors, Titan, Tata Steel, and Tata Consumer.

The number of PSUs will rise to seven thanks to BEL’s addition. Nifty includes Coal India, BPCL, SBI, Power Grid, ONGC, and NTPC. Stocks are thought to benefit in the short term by being included in well-known indices like the Nifty, Sensex, and MSCI Emerging Market Index, resulting in passive inflows. However, experts warn that this advantage frequently diminishes over time.

The reason is that stocks that have already experienced significant growth tend to be added to indices, leaving little room for additional upside. Shriram Finance, an NBFC, took over for UPL, an agrochemicals company, in the previous indices that was announced in February. The modifications took effect on March 28. From that point forward, portions of Shriram finance have acquired 23%, while UPL has acquired 27%.

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