El Al and Doral Energy to Join TA-35 Index, Replacing Three Companies
Translated & summarized from Ice by baba
El Al Israel Airlines and Doral Energy will join the TA-35 index on November 5, replacing Y.H. Demri, Shufersal, and Kanon, which will move to the TA-90 index. This is the first time El Al and Doral will be part of the main index, with an estimated NIS 10 billion in transactions expected. The changes reflect market performance, with Doral benefiting from green energy stock rises and El Al from a recent stock surge. The update also introduces a new mechanism to mitigate volatility from index inclusions.
The story in 6 lines · by baba
- El Al and Doral Energy will join the TA-35 index on November 5, replacing Y.H. Demri, Shufersal, and Kanon.
- This marks the first inclusion of El Al and Doral Energy in the Tel Aviv Stock Exchange's flagship TA-35 index.
- An estimated NIS 10 billion in transactions are expected around the index update.
- Doral Energy's inclusion is attributed to gains in green energy stocks, while El Al's was a last-minute addition after a stock surge.
- Shufersal is demoted to the TA-90 index for the second time in recent years.
- A new mechanism will be tested to moderate volatility from index inclusions, using a phased weighting factor.
Tel Aviv Stock Exchange announced that El Al Israel Airlines and Doral Energy will be added to the TA-35 index, while Y.H. Demri, Shufersal, and Kanon will be removed and moved to the TA-90 index. This marks the first time El Al and Doral will be included in the main index. The changes will take effect on November 5, with an estimated NIS 10 billion in transactions expected around the update.
Doral Energy secured its spot due to gains in green energy stocks up to May, with an average market cap of NIS 11.55 billion. El Al, valued at NIS 11.05 billion according to Smartbull, entered the index at the last minute following a surge in its stock after an incident involving a Flydubai plane. The companies being removed are Y.H. Demri (NIS 7.97 billion market cap), affected by a slowdown in the residential real estate market; Shufersal (NIS 9.56 billion), impacted by weak second-quarter reports; and Kanon (NIS 9.84 billion), influenced by its subsidiary OPC's stock performance and investor reaction to a new investment.
Shufersal's demotion to the TA-90 index is its second in recent years, having previously been removed in July 2022 and readmitted in May 2024. Energyix and Fattal Hotels were also contenders for the TA-35 but remained outside. The index update also sees changes in the TA-90, with Tidhar, Avisaror, Bagira, Alpha Tau, Telsys, and Afcon Holdings joining, while Electra Real Estate, Nassiym VeBinyan, Sela Real Estate, Eretz Industries, Qualitao, Ackerstein Industries, and Gilat will be removed.
For the first time, Best Group was excluded from the TA-90 due to not meeting trading liquidity requirements, despite meeting the market cap threshold. A new mechanism designed to moderate volatility around index inclusions will be tested, involving a phased weighting factor for new stocks entering the main indices. This gradual approach aims to spread demand over three tranches, reduce sharp fluctuations, and protect investors in tracking funds.
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