Adani Companies Get Rare Breather Amid Chaos As MSCI Defers Decision On Index Weighting Changes

MSCI has deferred its decision to reduce the weightage of two companies belonging to the Adani Group to its following review in May from the current review this month.

What Happened? The global index on Wednesday said that it will postpone the implementation of updates to weightings for two of the Adani Group companies, namely, Adani Total Gas and Adani Transmission, to its May benchmark review.

MSCI has cited potential replicability issues due to the impact of price limit mechanisms in the two stocks as the reason behind the delay. Replicability issues stem from the fact that if stocks are locked in a circuit, they cannot be sold.

The development arrive after MSCI said last week that it would cut the weightings of four Adani Group companies, including flagship firm Adani Enterprises, in its indexes after reassessing the number of shares that are freely traded.

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The new index weightings were due to come into effect on March 1 but the proposed changes to Adani Total Gas and Adani Transmission will be delayed until May.

That said, the changes to the weightings of Adani Enterprises and cement major ACC, are still due to go ahead.

Shares of various Adani Group companies have seen a massive sell-off since Jan. 24 after a US short-seller Hindenburg Research accused the conglomerate of “brazen stock manipulation” and accounting fraud.

Price Action: Adani Total Gas shares were trading 2.49% higher at ₹1,108.15, while Adani Transmission shares were up 3.07% at ₹1,049.95 shortly after markets opened on Thursday.

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