More pressure for Adani Stocks as MSCI to review free float status

MSCI (Morgan Stanley Capital International) on February 9 stated that some holders of Adani Group stocks should no longer be regarded as free float, and that it is now reconsidering this designation. Later on in the day, the modifications will be revealed. Free float, as defined by MSCI, is the percentage of outstanding shares that are available for purchase on the public equity markets by foreign investors.

According to a release, "MSCI has received comments from a variety of market participants about the eligibility and free float determination of several instruments affiliated with the Adani Group for the MSCI Global Investable Market Indexes (GIMI)."

The reason for starting a review of these securities was given by MSCI as follows: "MSCI has assessed that the characteristics of certain investors have sufficient ambiguity that they should no longer be characterised as free float pursuant to our methodology."

Adani Enterprises (71 basis points: $430 million), Adani Ports (40 basis points: $240 million), Adani Total Gas (55 basis points: $330 million), Adani Green (37 basis points: $220 million), Adani Transmission (48 basis points: $290 million), Adani Power (18 basis points: $100 million), Ambuja (32 basis points: $190 million) and ACC (21 basis points: $125 million) are the stocks that make up the MSCI India index.

Reacting to this news, shares of Adani Enterprises was locked in a 15% lower circuit limit at Rs 1,834.9 and among a was the worst performer. Adani Ports, Ambuja Cements, Adani Power, Adani Transmission, Adani Total Gas and Adani Green were trading 5% lower each.