KUALA LUMPUR: There could be changes in the FBM100 index constituents in the coming review in June with the potential addition of hard disk drives (HDD) component manufacturer JCY International Bhd to the list.

JCY had made a lacklustre debut on the Main Market of Bursa Malaysia last Thursday, with its share price closing 14 sen or 8% below its institutional price of RM1.60. It had a market capitalisation of RM2.99 billion and could potentially rise to RM4.7 billion if the share price hits our fair value of RM2.30 per share, RHB Research said.

"This will place JCY in 50th position among the top 100 companies by full market cap. However, with a free float of 28.4%, after adjusting for the smaller offering, we expect the company to be assigned a free float factor of 0.3 times.

"Therefore, on a free float-adjusted market cap basis, JCY would be placed in 69th position among the top 100 stocks of the FBM100 index, below Tan Chong and above Boustead. Any review of the free float factor would only be done in June," the research house said.

However, it noted that it could still be too early to be anticipating the changes to the FBM KLCI constituents in the June review.

JCY's full market cap of RM3.3 billion based on the initial public offering (IPO) price, did not meet the FBM Ground Rules for early addition to the FBM100 index, which requires a minimum of RM17.5 billion market cap. Therefore, the new listing had to wait till the June review.

"This is in contrast to Maxis, which was listed on 19 Nov 2009 with a full market cap of RM37.5 billion and therefore was added to the FBM KLCI early," RHB explained.

Based on its issue price, JCY would have an index weight of just 0.2%, making the company the second tech stock in the FBM100 with a larger weight than MPI (0.11%), it added.

With the addition of JCY, the smallest stock in the FBM100 will be demoted to the FBM Small Caps Index. Currently, Tradewinds Plantation Bhd is the smallest in the list by full market cap. The next four smallest stocks are Media Chinese International Ltd, Starhill REIT, OSK Holdings Bhd and Pos Malaysia Bhd.

Other changes in the FBM100 would depend on market conditions before the semi-annual review which is normally conducted end-May and implemented in June, it said.

"Two stocks have risen into the top 100 ranks excluding those that do not meet minimum liquidity criteria such as Lion Industries (with a full market cap of RM1.16 billion) and Unisem (RM1.08 billion), placing them at 93rd and 98th position respectively on the scoreboard," the research house said.