KUALA LUMPUR: Westports Holdings Bhd is likely to replace Inari Amertron Bhd on the 30-component FBM KLCI at the index's semi-annual review to be announced by FTSE Russell on June 2, says RHB Research.

       The research firm said Westports is the highest-ranked, most eligible of the non-component stocks while Inari will most likely drop out of the blue-chip index given its decline in the market capitalisation rankings to No.37.

       "According to the ground rules of the FTSE Bursa Malaysia Index Series, a security would be deleted if its market cap ranking among eligible securities drops to 36th or lower.

       "A security would be inserted into the FBM KLCI at the periodic review if its ranking by full market value rises to 25th or higher," it said in a report.

       It noted also that Hap Seng Consolidated Bhd is the highest ranked non-component stock for inclusion but it does not meet the liquidity test for inclusion.

       "A non-constituent stock that does not turn over at least 0.05% of its shares in issue (after the application of any investability weightings based on its median daily trading volume per month) for at least 10 of the 12 months prior to the semi-annual review will not be eligible for inclusion," it added.

       RHB expects the revised FBM KLCI reserve list, comprising the five highest-ranking non constituents of the index by market capitalisation, to be KLCC Property, QL Resources, Ambank, Batu Kawan and Malaysia Airports.

       The reserve list comprises stocks that would be used if one or more constituents are deleted from the FBM KLCI during the period until the next semi-annual review.

       The research firm also noted that Top Glove, the second lowest ranked component stock by market cap, has a RM2bil market cap lead over the 36th ranked stock.

       However, it could be at risk of dropping out of the index should its market price decline 25 sen or more.