Summary

Adani Energy Solutions Ltd faced a significant blow on Thursday as its shares dropped by 7% on the Bombay Stock Exchange (BSE) following exclusion from MSCI’s Global Standard Index. This exclusion, attributed to concerns about the company’s free float and a recent SEBI notice, added pressure to Adani’s stock. Despite this setback, Adani Energy reported a staggering 172% year-on-year profit growth in Q2, signalling strong performance even amid regulatory scrutiny.

Blow to Gautam Adani as Adani Energy Shares Dip by 7%

In a dramatic turn, Adani Energy Solutions Ltd saw a major 7.46% drop in its share price on Thursday at the Bombay Stock Exchange (BSE). The company’s shares fell to Rs 995, pushing its total year-to-date decline to 5.74%. This sharp fall followed MSCI’s decision to exclude Adani Energy from its Global Standard Index due to unresolved issues regarding the company’s free float status.

Why Was Adani Energy Excluded from MSCI’s Global Standard Index?

Morgan Stanley Capital International (MSCI), a U.S.-based global index provider, removed Adani Energy from its index, citing concerns around the company’s free float—or shares available for public trading. MSCI stated it would freeze the Number of Shares (NOS) for Adani Energy and hold back on adjustments, impacting the Foreign Inclusion Factor (FIF) and Domestic Inclusion Factor (DIF) for the company.

This decision was fueled by publicly available information about a show-cause notice issued by India’s market regulator, the Securities and Exchange Board of India (SEBI), which suggested possible misclassification of shareholding among Adani Group’s entities. As a result, MSCI flagged the uncertainty surrounding Adani Energy’s free float, excluding it from the global index.

Learn more: What is Free Float?

Financial Strength Amid Regulatory Challenges

Despite the stock market setback, Adani Energy Solutions reported an exceptional 172% year-on-year profit growth in Q2, a figure bolstered by increased EBITDA and a deferred tax reversal of Rs 314 crore. Excluding this tax benefit, Adani Energy still achieved a profit after tax (PAT) of Rs 459 crore, reflecting a solid 61.6% increase compared to last year’s performance. Meanwhile, revenue surged by 68.9% year-on-year, climbing to Rs 6,360 crore from Rs 3,766 crore.

Did you know? Adani Energy’s profit spike this quarter is one of the industry’s highest, highlighting strong operational performance despite regulatory challenges.

CERC Approval: Expanding Adani Energy’s Business Reach

In another key development, Adani Energy Solutions secured approval from the Central Electricity Regulatory Commission (CERC) to transfer its inter-state energy trading licence from Adani Enterprises. This strategic move enables Adani Energy to offer customised power solutions to industrial and commercial clients, potentially boosting revenue and expanding its footprint in India’s power sector.

About Adani Group

Founded by Gautam Adani, the Adani Group is a leading Indian conglomerate with diversified interests across infrastructure, energy, logistics, and more. Adani Energy Solutions, one of its critical subsidiaries, focuses on energy infrastructure and renewable energy projects, playing a vital role in India’s shift towards clean energy.

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