HDFC Bank and Reliance Industries have slipped out of the top 10 constituents of the MSCI Emerging Markets Index for the first time in more than two decades. According to reports from Business Standard, analysts tracking the benchmark confirmed this marks a historic departure, with the absence of any Indian company among the top 10 stocks being a first since at least 2000. The index serves as a benchmark for passive funds managing more than $700 billion globally and is closely tracked by actively managed emerging-market funds. As per The Economic Times, this represents a more dramatic shift - for the first time in years, not a single Indian company features among the top 10 constituents of the MSCI Emerging Markets Index, nor among the world's 100 largest companies ranked by market capitalisation, as a thundering rally in AI-linked stocks has concentrated global capital into a sliver of the investable universe.
India's largest constituents in the benchmark, HDFC Bank and Reliance Industries (RIL) have slipped to the 11th and 12th positions, respectively. As reported by Business Standard, their individual weights in the index have fallen below 0.8 per cent following weakness in their share prices this year. Sriram Velayudhan, senior vice-president at IIFL Capital Services, explained that relatively strong momentum in AI and semiconductor investment themes elsewhere has contributed to domestic companies losing their place among the top 10, with reduced weights having implications for both passive and active investment strategies. According to The Economic Times, Reliance Industries has now fallen to 109th position globally, highlighting the dramatic shift in market leadership.
AI-linked heavyweights have surged dramatically over the same period, with Taiwan Semiconductor Manufacturing Company (TSMC) up 48 per cent, Samsung Electronics rising 147 per cent, and SK Hynix gaining 194 per cent. According to Business Standard, shares of HDFC Bank and Reliance Industries are down about 26 per cent and 20 per cent, respectively, from their peaks. As per The Economic Times, TSMC sits at the apex with a float-adjusted market cap of $1.85 trillion and an index weight of 14.46%, making Korean memory chipmakers alone responsible for over 14% of the benchmark. The MSCI EM Index's top 10 is now dominated almost entirely by Taiwan and South Korean chipmakers and Chinese tech giants, with six of the top 10 slots occupied by information technology companies and the full top 10 together accounting for 39% of the entire index.
In the Nifty 50 index, ICICI Bank has overtaken Reliance Industries as the second-largest constituent by weightage, despite RIL commanding the highest overall market capitalisation of nearly ₹17.14 lakh crore. As reported by Livemint, ICICI Bank's free-float market capitalisation of ₹9.05 lakh crore is higher than Reliance Industries' free-float value of ₹8.52 lakh crore, enabling it to achieve an 8.78% weight in the Nifty 50 index compared to RIL's 8.27% weight. HDFC Bank continues to hold the highest weightage at 10.56% with a total market capitalisation of ₹11.33 lakh crore.
India's overall weight in the MSCI EM Index has slipped to a fresh six-year low of 10.87 per cent, nearly half the record level reached in 2024. As reported by Business Standard, Abhilash Pagaria from Nuvama noted that India's weight in emerging-market indices has declined over the past two years despite continued additions of new companies, largely due to the relative outperformance of Taiwan, South Korea and China benefiting from strong AI- and technology-led rallies. According to The Economic Times, India has also slipped behind Taiwan and South Korea in global market cap country rankings, now sitting at 7th place. By contrast, Taiwan commands the largest country weight at 26.41%, followed by South Korea at 23.06% and China at 20.36%. According to Yes Securities, which studied the top 10,000 listed companies globally, representing roughly 95% of world equity market capitalisation, global markets have added approximately $12 trillion in market cap so far in calendar year 2026, yet nearly 95% of that wealth creation has come from just 100 stocks, equivalent to a mere 1% of the investable universe.
