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Adani Group Shares Fall Again After MSCI Announces Review of Free Float

All 10 stocks of the Adani Group went down, with the flagship Adani Enterprises Ltd. Seeing a significant decline of around 15%.
An artist gives final touches to a painting of businessman Gautam Adani highlighting the ongoing crises of the Adani Group, in Mumbai, Friday, Feb. 3, 2023.

An artist gives final touches to a painting of businessman Gautam Adani highlighting the ongoing crises of the Adani Group, in Mumbai, Friday, Feb. 3, 2023. Image Courtesy: PTI

Delhi: Adani Group stocks began trading lower on Thursday after a two-day recovery. The fall was preceded by MSCI’s announcement of a review regarding the number of Adani Group-linked shares that are freely tradable in public markets, according to media reports.

Morgan Stanley Capital International (MSCI) said that some stocks of the Adani Group should not be designated as free float after investors raised concerns over the eligibility of the Adani companies for some of its indexes, the Financial Express reported. MSCI announced that any changes to the free float and market capitalisation of Adani Group stocks, which will impact the computation of these figures, will be implemented and announced as part of its February index review, to be released on February 9.

Following this news, all 10 stocks of the Adani Group went down; the flagship company Adani Enterprises Ltd. saw a significant decline of around 15%. The decline came after a significant increase of 35% in the last two days following the company’s announcement to pay off $1.11 billion in loans on shares ahead of their due date in 2024Moneycontrol reportedIn the trading sessions on Tuesday and Wednesday, Adani Group companies recovered around Rs 70,000 crore in combined market value.

Other associated stocks that experienced the decline include Adani Ports, which fell 7%, Adani Power (-5%), Adani Transmission (-5%), Adani Total Gas Ltd (-5%), Adani Green Energy (-5%), ACC declined (-3.7%), Ambuja Cement (-6.3%) and NDTV (-3.7%).

The decline in shares also comes after French energy giant Total Energies SE put on hold a multi-billion dollar project to produce green hydrogen with the group pending audits. A number of banks were purportedly said to have been unwilling to refinance some of the conglomerate’s debt following the rout prompted by short-seller Hindenburg Research’s report that levelled corruption and corporate malpractice allegations, Bloomberg reported. Adani has repeatedly denied the allegations.

The conglomerate’s market value has fallen sharply over the past two weeks after Hindenburg Research published the report on January 24. The group stocks have lost around Rs 8.7 lakh crore or about 45% of their combined market valuation since 24 January, according to reports.

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