PowerGrid extends losses

Shares of Power Grid Corporation fell another two per cent on Tuesday, ahead of the removal of the stock from MSCI index tracking emerging markets. MSCI has said Power Grid will be removed from one of its indices from November 26. The move by the index provider comes following restrictions placed by the Reserve Bank of India on further purchase of shares of the company by foreign investors.

Power Grid, one of the leading public sector undertaking, has seen its share price erode by more than six per cent in two days. In the latest rebalancing exercise, MSCI is said to have deleted four, added two, reduced weights of 61 and increased weight of two Indian companies in its portfolio.
 

According to analysts, the move is likely to result in net foreign outflows of nearly $200 million.