Hindenburg Discounted: MSCI Lifts Freeze On Adani Group Opening Potential For Foreign Inflows

The decision of MSCI, an index constructor, to include Adani Group stocks in its review comes as a shot in the arm for the conglomerate which has staged a come back ever since shortseller Hindenburg levied its allegations in January 2023.

The MSCI review comes a day after the markets ignored and shrugged off the latest allegations from Hindenburg Research against SEBI chief Madhabi Puri Buch.

Over the last year and a half the Adani Group has taken big strides notwithstanding the initial set back following the Hindenburg report.

The group has raised funds, stepped up its expansion and restored confidence among investors. Its recent fundraising for Adani Energy Solutions saw a big demand from QIP investors. The issue was subscribed six times and saw a demand of over Rs 50,000 crore against issues size of Rs 8,300 crore.

The review will now increase Adani Energy Solution's weightage in the MSCI coverage. It will also align the Adani group companies' weightages to foreign investment limits and additions in free float.

The MSCI move also coincides with the Adani Enterprises' proposed $2.2 billion in qualified institutional placement in the next few weeks.

The move is also aimed at diversifying the institutional shareholder base and bring more investors who understand the long term infrastructure businesses and hence stay invested for longer duration.

Adani group since March 2023 has been able to attract many invetsors including GQG Partners, IHC and other long only funds.

The latest move from MSCI to include the group stocks in future reviews is likely to open up flows for the group in its efforts to raise funds from global investors for its ambitious capex plans.

Adani Group stocks opened on a positive note on Tuesday morning after the MSCI index announcement.