NSE and BSE said they will add Gautam Adani-controlled Adani Power to the short-term additional surveillance measure ASM framework from March 23. The bourse said Adani Power will be shortlisted in the short-term ASM framework Stage-I effective March 23.
The Securities Exchange Board of India SEBI and exchanges share a list of securities that are currently being monitored due to factors like price fluctuation, volatility, volume variance, etc.
Stocks that have been shortlisted for inclusion on the ASM list serve as a warning to investors about unusual price movement.
On Monday, the two exchanges moved Adani group stocks, Adani Green Energy and NDTV from the second stage of the long-term ASM framework to Stage I.
Adani Power, Adani Enterprises and Adani Wilmar were put under short-term ASM by the NSE and BSE earlier this month. These three stocks were excluded from the short-term ASM framework later on March 17. Adani Power has satisfied the criteria for inclusion under short-term ASM, according to the NSE and BSE.
Under the short-term ASM, the exchanges said that the Applicable Rate of Margin shall be 50 per cent or existing margin whichever is higher, subject to the maximum margin capped at 100 per cent. f. March 24, 2023, on all open positions as of March 23, 2023, and new positions created from March 24, 2023. In this framework, market experts believe that intra-day trading would require a 100 per cent upfront margin.
On Wednesday, S&P Global Ratings said it is closely monitoring the Adani Group's governance and funding to decide on its ratings action.
S&P Global released a FAQ style commentary titled, Adani Group: The Known Unknowns, in which the rating agency said the investors are keen to know and have been seeking clarity on the credit impact of a series of allegations against the Adani Group, which was published on January 24th this year by US short seller Hindenburg Research.
Like most of the market, we wait for more information about the Adani Group before we decide the direction of our ratings. Credit analyst Abhishek Dangra said that the ratings would be affected by further details on governance and funding risks over the next 12 -- 24 months.
S&P Global said in its note that the Adani Group may face downside risks due to restricted access to funding and a broader view of the quality of the group's governance.
If an investigation uncovers serious wrongdoing, we are likely to take a negative rating action. S&P Global said it could include previously unreleased material related-party loans, cash leakage, or misreporting.
It added that in order to revise the outlook to stable, we need to be convinced that governance practices in the group and funding access will improve in line with an investment-grade credit profile. In the last week of February, S&P Global revised its ratings to negative on Adani Electricity Mumbai Ltd and Adani Ports and Special Economic Zone Ltd. to highlight the governance risks and funding challenges of the wider group. The ratings on these entities were affirmed by the credit rating agency.