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NSDL rectifies status of 3 foreign funds with huge stakes in Adani Group; shares rise

Only the funds' accounts linked to global depository receipt to remain frozen

Gautam-Adanin-reuters [File] Gautam Adani | Reuters

Shares of various Adani Group companies gained on Wednesday, even as the wider market was in the red, after National Securities Depository Ltd (NSDL) rectified the status of three foreign portfolio investors that predominantly held stakes in four companies of the ports-to-green energy conglomerate.

Shares of Adani Enterprises and other group companies had fallen sharply last month after the NSDL website showed that accounts of Albula Investment Fund, Cresta Fund and APMS Investment Fund had been frozen as on May 31, 2021. The investments of these funds in the four Adani Group companies – Adani Enterprises, Adani Green Energy, Adani Total Gas and Adani Transmission - was estimated to be over Rs 43,000 crore at the time.  That led to speculation that the three FPIs were banned from operating their accounts.

The recent update on NSDL shows that only those accounts of Albula, Crest and APMS that are linked to GDR (global depository receipt) are frozen. In the NSDL’s latest update on entities whose accounts are frozen as of July 26, 2021, GDR is now reflected in the names of the three FPIs to remove any confusion of sorts.

FPIs can have several demat accounts and this clarification from NSDL means only the GDR-linked accounts of Albula, Cresta and Amps may have been impacted and the three funds may still be able to operate other accounts.

Several of the Adani Group stocks had seen a massive rally over the past one year. On June 14, when the news of the account freeze was first reported, the stocks fell sharply, Adani Enterprises then issued a statement that the news was “blatantly erroneous” and done to “deliberately mislead the investing community.”

“Given the seriousness of the article and its consequential adverse impact on minority investors, we requested Registrar and Transfer Agent, with respect to the status of the Demat Account of the aforesaid funds and have their written confirmation vide its email dated 14th June, 2021, clarifying that the demat account in which the aforesaid funds hold the shares of the company are not frozen,” it had clarified.

On Wednesday, shares of Adani Green Energy and Adani Transmission rose more than 4 per cent. Adani Power was up 2.2 per cent, while Adani Group stocks were flat to positive. The broader BSE Sensex closed 135 points or 0.3 per cent lower.

The three funds have attracted attention in recent months as they have much of their money invested in Adani Group companies.  

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