Adani Enterprises to be dropped from Dow Jones sustainability indices
04/02/2023
new delhi, feb 3: S&P Dow Jones has said it will remove Adani Group's flagship firm Adani Enterprises from sustainability indices with effect from February 7 following a media and stakeholder analysis triggered by allegations of accounting fraud.
The move comes amid stock exchanges BSE and NSE putting three Adani Group companies Adani Enterprises, Adani Ports and Special Economic Zone and Ambuja Cements under their short-term additional surveillance measure (ASM).
The parameters for shortlisting securities under ASM include high-low variation, client concentration, number of price band hits, close-to-close price variation and price-earning ratio.
Market experts believe that putting in additional surveillance mean intra-day trading would require a 100 per cent upfront margin. The exchanges move might curb speculation and short selling in these stocks. "Adani Enterprises will be removed from the Dow Jones sustainability indices following a media and stakeholder analysis triggered by allegations of accounting fraud," S&P Dow Jones Indices said in a statement.
It will make the changes to the Dow Jones sustainability indices, effective prior to the opening on February 7.
Shares of Adani Enterprises were trading in the positive territory on the BSE in the afternoon trade on Friday. The counter had slumped 20 per cent in the morning trade. Before that, the stock had plunged over 26 per cent on Thursday and more than 28 per cent on Wednesday. The 10 listed Adani Group firms have faced a combined erosion of over Rs 8.76 lakh crore in the past six trading sessions. On Thursday, the National Stock Exchange (NSE) and BSE said three companies Adani Enterprises, Adani Ports and Special Economic Zone and Ambuja Cements companies have satisfied the criteria for inclusion in short-term ASM.
Under the short-term ASM, the exchanges said, "applicable rate of margin shall be 50 per cent or existing margin whichever is higher, subject to maximum rate of margin capped at 100 per cent, with effect from February 6, 2023 on all open positions as on February 3, 2023 and new positions created from February 6, 2023".
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