On the morning of February 13, Beijing time, MSCI Index (MSCI) announced the results of the quarterly index review, which is a quarterly routine adjustment of the standard, 4 A-shares in the MSCI Emerging Markets Index and 48 A-shares, which does not involve the adjustment of 20% of the A-share inclusion factor, which has almost no impact on the proportion of China's A-shares.
MSCI reviews and adjusts the index on a quarterly basis (February, May, August, November), and in 2017 MSCI announced the inclusion of A-shares in the MSCI Emerging Markets Index based on a factor of 5% of investable market capitalization, and in 2019 the inclusion factor of A-shares increased from 5% to 20%.
MSCI's adjustments to its major index series such as the Global Standard Index, the Global Small Cap Index, and the Global Micro Cap Index will take effect after February 29**. Among them, the relevant targets of MSCI emerging market index A-shares are adjusted to: 4 new targets such as Midea Group, China Merchants Highway, MGI, Samsung Medical, etc., with a total market value of about 550 billion yuan, and 48 ** such as Siruipu, Honglu Steel Structure, Puluo Pharmaceutical, and Yihualu, with a total market value of about 810 billion yuan. Among them, the largest market value of the target is Midea Group, with a market value of more than 420 billion yuan, and 48 A** value plates are relatively small, with a total market value of 10 billion yuan to 24 billion yuan.
It is reported that this time it is mainly based on the technical adjustment of the market value inclusion standard. In terms of transfer-in, Midea Group approached the upper limit of 30% foreign shareholding twice in January 2020 and December 2022, resulting in the inability of foreign capital allocation and was temporarily transferred out of the index by MSCI. After a one-year inspection period, Midea Group met the inclusion criteria and was re-re-redeployed. In terms of transfer-out, 48 companies were transferred out due to the decline in market capitalization, which was lower than the relevant total market value and circulating market value standards.