ID : Strategy - A double dose of index reshuffle

The JCI shall be rebalanced from full market cap to free float adjusted methodology starting in Oct 21 through Apr 22. This follows LQ45’s earlier transition over Feb-Aug 19, which had penalised its members with low free floats, particularly HMSP and UNVR. The imminent listings of Indonesia tech giants, potentially by 3Q21, could be even more disruptive to the key stock weightings of both JCI and LQ45. We project tech stock weight to command over 17% of JCI from 4% currently given the potentially large market cap and free floats. HMSP, UNVR and TPIA could see selling pressure (we estimate outflows of US$481m-523m each); BBCA, BBRI and TLKM should see less impact.

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