KUALA LUMPUR: YTL Power Bhd and YTL Corporation Bhd may both be included in the FTSE Bursa Malaysia KLCI (FBM KLCI) list of constituents, with Dialog Group Bhd and Westports Holdings Bhd on its way out.
According to Maybank Investment Bank (IB) Research, YTL Power and YTL Corp's market capitalisation ranking have climbed to No.23 and 24 respectively as at Nov 7, 2023 market close and both stocks could feature as FBM KLCI constituents if their ranking are at No.25 or above, at the close of trading on the upcoming constituent review date.
The cut-off date for the constituent review is November 20, 2023.
Existing constituents, Dialog, ranked No.34 in full market capitalisation as of November 7, Westports was at No.36.
"We estimate that both YTL Corp and YTL Power meet their liquidity test to be eligible as FBM KLCI constituents," Maybank IB Research said.
If both YTL Corp and YTL Power feature as FBM KLCI constituents and take over from Dialog and Westports, Maybank IB Research estimates their KLCI weight to be 1.5 per cent and 1.3 per cent respectively vs. Dialog's present weight of 1.8 per cent and Westports' 0.7 per cent.
Under such a scenario, Utility sector's weight on the index will rise to 14 per cent from 11.3 per cent now.
Financial Institutions' weight will be little changed at 42.6 per cent (vs. 42.7 per cent now); Telcommunications will be at 11 per cent (vs. 11 per cent now) and Plantation at 9.9 per cent (vs. 10 per cent now).
These top four sectors by market capitalisation will have a higher combined weight of 77. per cent (vs. 75 per cent now).
The FBM KLCI comprises the largest 30 companies listed on the Main Board by full market capitalisation that meet the eligibility requirements of the FTSE Bursa Malaysia ground rules.
The two main eligibility requirements stated in the FTSE Bursa Malaysia ground rules are the free float and liquidity requirements.