NSE removes Adani Enterprises from short-term additional surveillance

Adani Enterprises will be moved out of the short-term additional surveillance measure (ASM) framework of the National Stock Exchange (NSE) after one month of being under it along with two other Adani Group stocks following a massive sell-off in stocks, the Economic Times reported.

In times of high volatility in stocks, exchanges move stocks to short-term or long-term additional surveillance frameworks in order to safeguard investors from short-selling or speculative trades.

Established in 2018, the ASM framework was put in place to protect retail investors from the unusual movement of stocks and shield them from volatility. Companies may be placed under the ASM list for a variety of reasons like unusual price movement, volume variation, etc. When a stock is included in ASM list, it serves as a warning to the investors about unusual activity in the stock and some trading restrictions are put on these stocks to halt unnecessary speculation.

The stock will move out of the ASM framework from Wednesday, according to the report.

NSE had put Adani Enterprises, Ambuja Cements and Adani Ports and Special Economic Zone under ASM framework in February. 

Ambuja Cements and Adani Ports were removed from surveillance in the previous month.

The US-based short seller Hindenburg Research released a report in January against the Adani Group. The report's claims against the Adani group lead to a massive bloodbath on the stocks, and caused great losses to investors. Adani Group stocks lost at least 50 per cent of their market value.

After facing relentless selling for over a month, the group stocks got some respite last week with a Rs 15,000-crore bet by global asset management firm GQG Partners. For Adani Group stocks, this bet proved to be a lifeline as it saved the day for Gautam Adani.

GQG Partners bought 3.4 per cen stake in Adani Enterprises, 4.1 per cent stake in Adani Ports, 2.5 per cent stake in Adani Transmission, and 3.5 per cent stake in Adani Green Energy.

Since then Adani Enterprises shares have risen by 66 per cent. On Monday, March 6, stock rose as much as 14 per cent intraday to test a high of Rs 2,135.