Hindenburg Research's founder Nathan Anderson on Thursday said MSCI's latest release on Adani validates Hindenburg's findings on offshore stock parking by the Adani group.
MSCI said it has determined that the characteristics of certain Adani investors have sufficient uncertainty that they should no longer be designated as free float pursuant to our methodology.
"This determination has triggered a free float review of the Adani Group securities," MSCI said on Thursday.
MSCI said it will implement the resultant free float changes and associated market capitalisation determinations in connection with the February 2023 Index Review using data as of cut-off dates. The pro forma results of the February Index Review, including these changes, are scheduled to be announced on February 9.
In addition, as part of the February Index Review MSCI said it would suspend any potential changes to the number of shares (NOS) for the affected securities.
"Further, until otherwise announced, MSCI will review the treatment of non-neutral corporate events for the affected securities on a case-by-case basis and potentially defer their implementation. The treatment of any such non-neutral corporate event would be announced to all clients with advance notice through regular index announcements. For the avoidance of doubt, MSCI will continue implementing any neutral corporate events including ones requiring application of a Price Adjustment Factor (PAF)," MSCI said.
MSCI said all the affected securities will be further reviewed as part of the scheduled Full Country Float Review in May 2023 Index Review.
MSCI said it will continue to monitor publicly available information that may impact the eligibility of the relevant securities for the GIMI or estimates of their free float.
The Hindenburg Research report accused the conglomerate of “brazen stock manipulation, money laundering, and accounting fraud scheme over the course of decades”. The short seller claimed that the report was summed up after a two-year investigation. Defending itself, the Adani Group called Hindenburg's report "maliciously mischievous and unresearched", which, it said, adversely affected the Adani Group, its shareholders, and investors.
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