Birla group firm UltraTech Cement and drug maker Lupin will replace public sector Steel Authority of India Ltd (SAIL) and Vedanta group firm Sterlite Industries in the National Stock Exchange's benchmark index Nifty from Friday.
As per the changes announced last month by India Index Services & Products Ltd (IISL), an NSE-Crisil joint venture that maintains Nifty
index, SAIL and Sterlite Industries (India) would be excluded from the 50-share benchmark index with effect from September 28, 2012.
In their place, Lupin and UltraTech Cement would be included in the Nifty index.
Analysts say the removal of SAIL and Sterlite from the Nifty underlines the negative sentiment prevailing on the materials sector even as valuations are at multi-year lows.
Shares of SAIL and Sterlite Industries also fell due to the new changes.
After making a weak opening, shares of SAIL closed 3.8% down to close at Rs. 85.80, while shares of Sterlite Industries declined by 3.1% to close at Rs. 97.60 on the NSE. The Nifty closed 0.3% down at 5,650 points.
On the other hand, UltraTech Cement scrip rose by 2.9% to close at Rs. 1,950 after hitting 52-week high of Rs. 1,989. Similarly, Lupin gained 1.7% to close at Rs. 596.