MSCI Change: Adani shares enter worst week since February 2023. $10 billion m-cap loss

The market capitalization of Adani Group fell by about $10.1 billion to $107 billion in the last week. Adani Total Gas And Adani Transmission — the two stocks downgraded by MSCI — are headed for their worst weeks since late February. Brian Freitas, an independent equity analyst published on SmartKarma, said the MSCI exclusion would likely trigger about $390 million of selling by global passive funds later this month.

flagship company of adani group Adani Enterprises It posted a weekly loss of 4 percent, the most since March. The company and its transmission unit last week launched plans to raise $2.6 billion through qualified institutional placement or other means, raising concerns of equity dilution.

“If the shares in the QIP issue are priced very low, it can be seen as a sign of weakness or desperation,” Arpit Shah, a fund manager at Care Portfolio Managers, said in an email.

A Hindenburg Research report on Adani group companies in January wiped out more than $150 billion from the group’s market value by the end of February. These losses were pared down during the past two months as emerging market investor GQG Partners bought stakes in the four entities in early March. This led to a jump in some shares of Adani Group.

However, Gautam Adani and his fleet of lieutenants are denying the allegations made by the US short seller, taking steps after the report to address investor concerns over debt and corporate governance.

(with inputs from Bloomberg)