Index provider MSCI announced Thursday that Adani Transmission, Adani Total Gas and Indus Towers have been removed from the MSCI India Index. These changes will come into effect 31 May, 2023 onwards. On the other hand, as a result of the rejig, Max Healthcare, Hindustan Aeronautics and Sona BLW Precision have been added to MSCI’s India Standard Index.
The rejig is a setback for the Adani group companies, who are trying to demonstrate strength after the Hindenburg Research report that alleged the conglomerate of stock market manipulation and fraud. Additionally, this move comes as flagship holding firm, Adani Enterprises announced a plan to raise funds via a stake sale on Wednesday.
On May 05, 2023, MSCI announced that the certain Foreign Inclusion Factor (FIF) changes for Adani Total Gas and Adani Transmission will be implemented in the May 2023 Index Review. Adani Total Gas’s FIF fell from from 0.25 to 0.14 while Adani Transmission’s FIF dropped from from 0.25 to 0.10. “As a result of these changes, these two securities will no longer be eligible for inclusion in the MSCI Global Investable Market Indexes (GIMI) as the companies will not meet the relevant free float-adjusted market capitalization requirements,” said MSCI.
ACC, Adani Enterprises, Adani Green Energy, Adani Ports and Sez, Adani Power, Ambuja Cements will have no changes in their inclusion status in the MSCI GIMI as a result of the May 2023 Index Review.
In February, MSCI had cut the free-float designations of four Adani group stocks. The index provider said in a statement it has reduced the free floats of Adani Enterprises, Adani Total Gas, Adani Transmission and ACC. The four companies, for which the free float designation change was announced, had a combined 0.4% weighting in the MSCI emerging markets index as of 30 January. The changes went into effect on 1 March 2023.