MSCI has said if these two Adani group stocks get locked in their lower trading limit for a cumulative 5 minutes on May 31, the deletion will take place at zero value. If not, the index provider will use the official closing price.
The deletion of these two stocks from the MSCI India index follows reduction in their free float following feedback from market participants in February in the wake of allegations made by US-based Hindenburg Research on January 24.
Following the announcement, analysts had forecast the removal of Adani Transmission from the MSCI index as on the lower float, it would have failed to meet the minimum market cap threshold required to continue in the index. They had forecast that Adani Total Gas would just about meet the threshold.
Insight provider Brian Freitas of Periscope Analytics, who publishes on Smartkarma, forecasts selling to the tune of Rs 1,535 crore ($187 million) in Adani Total Gas and Rs 1,666 crore ($203 million) in Adani Transmission.
Indus Towers too, has been removed from the MSCI India index. As a result, it will see selling to the tune of Rs 665 crore ($81 million) by index funds.
Meanwhile, Max Healthcare Institute, Hindustan Aeronautics and Sona BLW Precision Forgings have got added to the index, which will result in passive inflows of around Rs 2,020 crore, Rs 3,010 crore and Rs 1,800 crore, respectively.