Index provider MSCI has said it will postpone the proposed weightage reduction in Adani Transmission and Adani Total Gas to May 2023.

Last week, MSCI announced it would reduce the weightage of four Adani companies — Adani Enterprises, Adani Transmission, Adani Total Gas, and ACC — from March.

“On February 8, MSCI announced that it will update the Foreign Inclusion Factors (FIFs) of specific securities associated with the Adani Group as part of the February 2023 Index Review following a free float review.”

In the light of potential replicability issues due to impact from price limit mechanisms in specific securities associated with the Adani group, MSCI will postpone the implementation of such previously announced updates to the FIFs for Adani Total Gas and Adani Transmission to the May 2023 index review, MSCI said. MSCI’s methodology calls for indexes to be replicated “in an actual portfolio in a cost-efficient manner’’.

The announcement did not have any impact on stocks: The Adani Total Gas share fell 5 per cent to close at Rs 1,024.95 on the Bombay Stock Exchange, while Adani Transmission slipped 4.93 per cent to finish at Rs 966.95.

Brian Freitas of Periscope Analytics said based on their closing prices, Adani Power, Adani Total Gas and Adani Transmission may be removed from MSCI India index during the rebalancing exercise in May following a sharp correction in their prices.

ESG review

S&P Global Ratings on Thursday placed its ESG evaluation for Adani Transmission Ltd (ATL) ‘’under review’’.

When monitoring environment, social and governance (ESG) evaluations, S&P uses the term ‘’under review’’ to identify certain ESG Evaluations as being potentially affected by changing events.

“We will closely monitor developments, including any investigations by the Indian regulators and any additional disclosures by the Adani group,” S&P Global Ratings said in a statement.

“Our current assessment of ATL’s governance factors in some controlling shareholder’s weight in decision-making, including on related-party transactions. Common parentage and name-sharing also expose ATL to reputational risks from the wider group,” it said.

No special audit plan

Mumbai: The Adani group has denied news reports that it appointed Grant Thornton to conduct an independent audit of the books at some group entities. In a clarification to the stock exchanges, group flagship Adani Enterprises Ltd (AEL) termed the news reports as market rumours.

“We would like to clarify that the said news item appears to be a market rumour and hence it would be inappropriate on our part to comment on it,’’ the regulatory filing said after the bourses sought a clarification on the report.

Earlier, there were reports the group has appointed the accountancy firm for an independent audit of some of its firms as it sought to come clean after the damaging allegations made by US short-seller Hindenburg Research and assure investors and regulators. The Adani group had refuted all the allegations of Hindenburg.

The reports said the audit was being done primarily to show to regulators such as the RBI the group has nothing to hide and is in compliance with the laws.

The audit will specifically look into any misappropriation or repatriation of funds. It was also reported that the audit will look if loans were diverted to other uses.

OUR SPECIAL CORRESPONDENT