Zalando defends its place: Lufthansa narrowly misses promotion to the DAX

Lufthansa, which was kicked out of the DAX after the Corona crisis, has to wait until it returns to the top German stock market league. However, there is good news for Zalando – and for SAP.

Deutsche Lufthansa has to wait for a return to the leading DAX index. During the regular review of the most important German stock market indices, there were no changes in the league of the 40 largest German stock market stocks, as Deutsche Börse announced late yesterday evening. This means that the online fashion retailer Zalando, which was considered the first candidate for relegation, can just about defend its place in the top German stock market league.

Corona crisis brought Lufthansa to its knees

The airline was expelled from the DAX in 2020: At that time, the Corona crisis brought airlines worldwide to their knees. Lufthansa even had to be supported with billions in state aid in order to avert the impending bankruptcy. The group has now repaid the pandemic funds along with 92 million euros in interest.

But competitors Ryanair and Condor continue to see this as a competitive disadvantage, so they sued the EU Commission against the EU Commission’s approval of state aid – and were proven right. However, the Lufthansa Group itself did not want to let the verdict stand and appealed. A decision is still pending. By returning to the DAX, the Lufthansa Group could have at least dealt with the Corona crisis a little further on the stock exchange.

Bilfinger returns to MDAX

While there are no changes at all in the DAX, two newcomers will soon be represented in the MDAX of the 50 next largest stocks: The biotech company Morphosys is about to be taken over by the Swiss pharmaceutical giant Novartis after the price went through the roof as a result of the purchase offer is.

The industrial service provider Bilfinger is returning to the MDAX after six and a half years. The two replace the automotive supplier Vitesco, whose free float has fallen to a good ten percent due to Schaeffler’s entry, and the kitchen equipment supplier Rational.

Rational is excluded from all DAX indices

Its market value would have easily been enough for the small cap index. However, Rational is completely excluded from the DAX indices because the company from Landsberg am Lech no longer meets the rules for good corporate governance. These are part of the DAX regulations of the Deutsche Börse. The chairman of the audit committee on the Rational supervisory board is no longer considered independent after more than twelve years as a member of the board. For a similar reason, Krones was temporarily expelled from the DAX indices last year.

The Audit Committee – a reaction to the Wirecard scandal

The audit committee was introduced in mid-2021 – the legislature thus drew conclusions from the Wirecard scandal. Accordingly, this committee is supposed to take care of sensitive issues such as accounting, audits and internal audits. The independence of its chairman is therefore set out in point C.10 of the German Corporate Governance Code explicitly requested. There it says:

EX-DAX member MLP makes it into the SDAX

In contrast to Rational, MDAX relegated Vitesco meets this requirement and will therefore still be listed in the SDAX small-cap index in the future. The financial service provider MLP is moving there again after almost four years. He was even a member of the DAX in the early 2000s. The changes will take effect on the Monday after next (March 18).

SAP will have a higher DAX weighting in the future

From then on, a DAX value, measured by the index weight, may account for more than ten percent of the DAX for the first time after the index has been recalculated. The stock exchange raised the cap limit to 15 out of ten percent in the fall, thereby adapting to international standards. This was preceded by a broad market consultation in which a majority was in favor of a higher cap.

Deutsche Börse wants to prevent other heavy DAX companies such as SAP from fleeing. After all, the traditional German group Linde justified its departure from the German capital market at the beginning of 2023, among other things, with the cap. Caps by companies not only hinder the price development of the index, but also that of the affected stock.

Initially, only the software company SAP can benefit from the new regulation, whose index weight recently increased to more than twelve percent. Its DAX weight is no longer reduced to ten percent.

With information from Angela Göpfert, ARD financial editorial team.