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Mumbai: The stock exchange stated on Sunday that all such decisions to include and exclude stocks from its indices are taken in accordance with pre-established rules, in response to criticism from a variety of sources regarding the inclusion of two of the ten Adani Group entities in some of the indices. Additionally, the NSE stated that its stock surveillance procedures are completely non-discretionary and based on predetermined rules.
There has been pressure on the markets regulator and the bourses to take action against listed companies that are part of the Adani Group since the US-based shortseller Hindenburg Research released a damning report about the group that claimed stock manipulation, accounting fraud, and corporate malfeasance. Despite the fact that the group denied every one of the claims made in the report, its total market capitalization has decreased by more than 50% from its pre-Hindenburg level of Rs 19.2 lakh crore. NSE Indices, the NSE division that manages all of the bourse's indices, announced on February 17 that, as of March 31, it would include Adani Wilmar and Adani Power in some of its indices while simultaneously excluding these stocks from other indices. This announcement came amid the ongoing controversy surrounding the stocks of Adani Group.
Record consideration and rejection of stocks on an intermittent premise, by NSE Lists, "depend on file philosophies that are evenhanded, non-optional, rules based, pre-reported and straightforward". “NSE Indices or its committees exercise no human discretion in deciding on inclusion or exclusion of stocks in any of its indices,” it stated in a statement after the criteria for the index had been established.
Additionally, the NSE stated that its "surveillance actions on stocks (are) non-discretionary, pre-announced, automatically applicable, (and) transparent" and that these regulations apply to all eligible stocks.