NSE places Adani Enterprises, two other Adani stocks under short-term ASM framework from March 9

National Stock Exchange on Wednesday announced that Adani Enterprises Ltd and two other Adani Group firms will be placed under short-term additional surveillance measures framework from March 9.

Adani Power and Adani Wilmar Ltd are the other two firms of the embattled Adani Group placed under the short-term ASM framework Stage - I. The scrips of Kiri Industries Ltd, Tata Teleservices (Maharashtra) Ltd, Uniinfo Telecom Services, Stampede Capital, DB Realty, Asian Energy Services have also been placed under short-term ASM framework, announced NSE on Wednesday.

Interestingly, on Monday, the National Stock Exchange (NSE) and BSE on Monday announced that Adani Enterprises, the flagship firm of Adani Group, will move out of the short-term ASM framework from March 8. On Wednesday, Adani Enterprises' scrip on BSE closed nearly 3% higher at Rs 2,039 while Adani Power and Adani Wilmar closed 5% higher.

Last month, both the NSE and BSE had put three Adani Group companies under the short-term additional surveillance measure framework to curb volatility induced in the counters due to an US short seller's scathing report against the conglomerate. Apart from Adani Enterprises, the other two firms listed by the exchanges were - Adani Ports and Special Economic Zone (APSEZ) and Ambuja Cements. However, APSEZ and Ambuja Cements were removed from the ASM framework on February 13.

The listed entities of Adani Group saw a whopping $130-billion erosion of market value since January 24, when Hindenburg Research released a report alleging stocks manipulation and accounting fraud by the Gautam Adani-led conglomerate.

Adani Group had denied all the allegations, and accused Hindenburg of committing a "calculated securities fraud".

Adani Group stocks recorded a sharp recovery since late last week as US boutique investment firm GQG Partners announced a cumulative investment of Rs 15,446 crore in four Adani firms, namely Adani Enterprises, Adani Green Energy, Adani Ports and Adani Transmission. Billionaire Gautam Adani's fortunes topped $50 billion-mark as Adani shares have started rallying post GQG's investment.

Stock exchanges put stocks under ASM based on several parameters including high-low price variation, volume variation, delivery percentage, client concentration in stocks, close-to-close basis price variation and market capitalisation, among others.

In short, stocks with unusually high volatility are put under ASM framework. The main objectives of these measures are to alert investors to be extra-cautious and advice them to carry out due diligence while dealing in such stocks. The framework came into force in March 2018.

As per NSE, applicable margin rate for the stocks under ASM Stage - I is 50 per cent or existing margin, whichever is higher, subject to a maximum margin of 100 per cent. For Stage - II, the applicable margin rate is 100 per cent or existing rate, whichever is higher.

On Wednesday, NSE also moved two Adani Group stocks, NDTV and Adani Green Energy, to long-term ASM framework Stage - II from long-term ASM framework Stage - I.

At present, there are 29 stocks on NSE under short-term ASM framework. On the other hand, there are 89 stocks under long-term ASM.

National Stock Exchange on Monday removed four Adani Group firms, Adani Enterprises Ltd, Adani Green Energy, Adani Total Gas and Adani Transmission, along with 10 other firms, from its Nifty Alpha 50 index.

NSE has also excluded Adani's cement stocks, Ambuja Cements and ACC, from Nifty Low Volatility 50 index.

Also, Adani Enterprises, Adani Green Energy, Adani Ports, Adani Total Gas, and Adani Transmission got excluded from the Nifty 100 Alpha 30 index. Meanwhile, Adani Enterprises also got excluded from the Nifty 200 Alpha 30 index.

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