MUMBAI, INDIA — Global stock index compiler MSCI has dropped two firms in the embattled Adani Group from its India index, in a blow to the conglomerate months after it was hit with market manipulation allegations.
US-based MSCI said in a statement on Friday that Adani Total Gas and Adani Transmission — part of the business empire of Indian billionaire Gautam Adani — would be deleted from its India Domestic Index at the close of trading on 31 May.
MSCI said it assessed the two firms “will not meet the relevant free float-adjusted market capitalisation requirements”, referring to shares that can be bought on public stock markets by international investors.
Share prices in the two listed entities fell during early trading in Mumbai on Friday, with Adani Total Gas hitting its lower limit of 5.0 per cent while Adani Transmission dropped by 3.80 per cent.
The decision came two days after flagship Adani Enterprises said its board would meet on Saturday to consider raising funds through a sale of shares or other securities.
India’s Supreme Court was due to hear a petition on Friday from securities regulator SEBI requesting a six-month extension of its probe into the manipulation allegations.
US short-seller investment group Hindenburg Research accused the Adani Group in January of using offshore tax havens to manipulate stock prices.
The allegations wiped out up to US$120 billion in value from the Adani Group, which abruptly cancelled a stock sale.
The group’s shares have recovered slightly since then, but shares in its flagship unit Adani Enterprises remain at around half of their value before the claims were published.
Adani has repeatedly denied the allegations and accused the US investment firm of a “maliciously mischievous” reputational attack.
Gautam Adani fell from third to 24th on Forbes’ real-time billionaires’ list after the stock market rout.