Outflow of half a billion dollars likely after MSCI index review and reduced weightage of four Adani group companies
Adani group companies are likely to see a possible further outflow of half a billion dollar foreign money in March as a consequence of an index review and rebalancing of weightage by MSCI. On Friday, the index provider reduced the weightage of four Adani group companies in the MSCI Global Standard index, which will be effective after closing of trade on February 28.
However, cuts in the four companies’ weightage are minor. Adani Enterprises, Adani Transmission, Adani Total Gas and ACC have seen a reduction of weightage in the index by 0.02 to 0.3 basis points. That would roughly work out to an outflow of $428 million, according to estimates by Abhilash Pagaria, analyst, Nuvama Alternative & Quantitative Research. “MSCI has also changed the Foreign Inclusion Factor (FIF) in a few names and the major downward revision has been seen in Adani Transmission, Adani Total Gas and Adani Enterprises. This will lead to meaningful outflows in these names,” Pagaria says.