NSE has removed Adani Ports and Ambuja Cements from the short term ASM framework and the decision will become effective from 13th February 2023
Adani Ports & Special Economic Zone and Ambuja Cements have both been taken off the National Stock Exchange's (NSE) short-term Additional Surveillance Measure (ASM) framework. The change will take effect on Monday, February 13, 2023, or the next week. On February 3, 2023, the NSE placed these two Adani stocks under the ASM framework following a sharp decline in the price of Adani Group equities as a result of a Hindenburg Research research that raised concerns about the debt positions of Adani Group firms. However, the short-term ASM structure would still apply to Adani Enterprises shares.
What does this action entail for the stocks of Adani?
Moving outside of the ASM framework would entail less strict regulations, such as no 100% margin and no leverage for intraday traders. Additionally, equities that are covered by the ASM framework cannot be pledged. ASM framework won't have an impact on business actions like dividends, bonus shares, stock splits, etc.
The strict measures outlined above won't apply to these Adani group stocks because NSE excluded Adani Ports and Ambuja Cements from the ASM framework. When the stock market reopens on Monday following the weekend, leverage will now be available on shares of Adani Ports and Ambuja Cements, which could result in a spike in transaction volume for both Adani stocks.
According to the exchanges' and SEBI's joint surveillance meeting, the following margins would be applied to derivative equities under the short-term ASM framework:
Stage 1: 50% of total margins now in effect, whichever is larger, subject to a 100% cap on the maximum rate of margins.
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