Adani Group shares trade weak in a firm market; decline up to 5%

In past two days, stock price of Adani Transmission and Adani Total Gas dipped 7 per cent and 9 per cent, respectively, after Global index provider MSCI dropped these stocks from its India index.

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Shares of Adani Group companies were trading on a weak note, falling up to 5 per cent on the BSE in Monday’s intra-day trade in an otherwise firm market.

Adani Total Gas, Adani Transmission, Adani Enterprises, Adani Power, Adani Green Energy, Adani Wilmar and Adani Ports and Special Economic Zone were down in the range of 2 per cent to 5 per cent. ACC, Ambuja Cements and New Delhi Television (NDTV) were down 1 per cent each on the BSE. In comparison, the S&P BSE Sensex was up 0.38 per cent at 62,266 at 10:23 AM.

Over the weekend, two Adani Group companies announced plans to raise up to Rs 21,000 crore from the market. Adani Enterprises, the flagship company of Adani Group, said that its board has approved plans to raise up to Rs 12,500 crore via qualified institutional placement (QIP), while Adani Transmission said its board approved a plan to raise up to Rs 8,500 crore from the stock market.

However, the renewable energy company has rescheduled its board meeting, that was to be conducted on May 13, to May 24, citing ‘certain exigencies’. The board meeting is scheduled to consider and approve the proposal to raise funds.

Meanwhile, Adani Transmission, Adani Total Gas, and Adani Green will exit ASM (Additional Surveillance Measure) framework on Monday.

In past two trading days, the stock price of Adani Transmission and Adani Total Gas dipped 7 per cent and 9 per cent, respectively, after Global index provider MSCI dropped these stocks from its India index.  This move will result in selling worth Rs 3,200 crore ($390 million) in these two counters by exchange traded funds (ETFs). The change will become effective from May 31.

The deletion of these two stocks from the MSCI India index comes on the back of a reduction in their free float market cap by the index provider. In February, MSCI had announced that it is re-designating free float of four Adani group stocks following feedback from market participants in the wake of allegations made by US-based Hindenburg Research on January 24.