MSCI inclusion leads to $250 million inflows for Adani Energy Solutions

Shares of Adani Energy Solutions Ltd (AESL) surged 3.8 percent in the last trading session on Wednesday, even as the broader market remained flat. This increase is attributed to expectations of strong inflows by the end of August due to the company's inclusion in the MSCI Index, with brokerage houses forecasting inflows of $250 million.

On Tuesday, MSCI announced that it has lifted the embargo on Adani Group stocks, making them eligible for inclusion in the MSCI India Index. This follows the removal of Adani Group stocks from the index in late January 2023 due to concerns over free-float uncertainty.

Lifting this restriction means that recent changes in free float and equity raises are now eligible for inclusion. Additionally, stocks that were previously excluded can be reintroduced. 

Earlier in August, Adani Group's power transmission, distribution, and smart metering company completed a $1 billion Qualified Institutional Placement (QIP), resulting in a substantial increase in the company's free float.

Adani Enterprises, another company within the group, has proposed raising nearly $2 billion. If successful, this could potentially attract $110 million in inflows, according to brokerage firms.

However, Adani Total Gas, which was also removed from the MSCI Index last year, is unlikely to be re-included in the near future as its stock is trading well below last year's highs.

Adani Enterprises Ltd is a key player in the Adani Group, primarily engaged in diverse sectors such as infrastructure, energy, and resources. The company operates in areas including coal trading, logistics, power generation, and manufacturing. It serves as a major entry point for investors looking to participate in the group's various business ventures and has been involved in significant fundraising activities, such as its recent proposal to raise nearly $2 billion.