According to reports from Upstox, BSE will replace Wipro in the benchmark NIFTY50 index after September 30, 2026, marking the end of Wipro's nearly three-decade-long run in the index. The index rejig, which takes place semi-annually based on data for six months ending January and July, balances index weightage by including new performing sectors and excluding underperforming ones. As reported by Upstox, the rejig often triggers major fund flow activity as index funds rebalance their holdings accordingly, leading to significant inflows and outflows for included and excluded stocks respectively. A four weeks' prior notice is given to market participants before any replacement implementation.
As reported by Upstox, the Indian equity markets are showing lackluster performance with NIFTY50 trading in red in 2026, down nearly 10% year-to-date. The index composition shows 31 out of the 50 constituents trading in red in 2026, while 19 others are in positive territory, further signifying broader weakness in the benchmark index. The IT sector has been particularly underperforming due to sectoral headwinds in the aftermath of Artificial Intelligence, with many key IT stocks like TCS, Infosys, Tech Mahindra, and HCL Technologies trading over 30% down from their record highs.
According to Upstox reports, BSE's average free-float market capitalization for six months is more than Wipro's six-month average free-float market capitalization, which serves as a key technical reason for BSE's inclusion in the benchmark NIFTY50 index. This technical metric, combined with BSE's strong rally performance in recent periods, has contributed to the exchange's selection over Wipro for the index inclusion. The replacement process is governed by strict guidelines where equity shareholders' approval is considered as a trigger for capital restructuring or voluntary delisting cases, ensuring proper corporate governance standards are maintained.
As reported by Upstox, data analysis of stocks excluded and included from NIFTY50 over the last five years reveals contrary insights to general investor beliefs. On a one-year basis, only 6 stocks delivered positive returns, while 4 delivered negative returns, with Bharat Electronics rising the most at 41% returns and Trent losing the most at 38%. The analysis suggests that stocks excluded from the index have more winners in six and one-year periods after exclusion, while stocks included tend to slow down more after inclusion, potentially due to completion of bottoming out phases and rerating after falls. Additional index reconstitution may be undertaken for various corporate actions including mergers, demergers, delistings, and regulatory findings that necessitate removal of constituents from the index.
