The National Stock Exchange on Thursday added Adani Ports and Special Economic Zone to its F&O ban list for February 3, the first day of weekly series, after the scrip crossed 95 percent of the market-wide position limit.
This is the second stock in the F&O ban list for Friday. Adani Ports has been under pressure for last several sessions along with other Adani Group stocks, after American short seller, Hindenburg Research accused Adani Group of using tax havens and flagged debt concerns in a report.
Adani Ports lost more than 50 percent from its high of Rs 988 on September 20, 2022 along with severe correction in other Adani Group stocks.
Also the National Stock Exchange (NSE) has put Adani Ports as well as Adani Enterprises, and Ambuja Cements under additional surveillance measure (ASM) framework effective February 3, 2023 to curb short-selling, especially after carnage in Adani Group stocks.
"Applicable rate of margin shall be 50 percent or existing margin, whichever is higher, subject to maximum rate of margin capped at 100 percent w.e.f. February 6, 2023 on all open positions as on February 3 and new positions created from February 6," the exchange said in its circular. The stocks under surveillance shall be retained in Stage-I as applicable for a minimum period of 5 trading days and shall be eligible for review from 6th trading day onwards.
Further there was huge short built-up in Adani Ports and was at the second spot after Birlasoft in the short build-up list on February 2. The stock was down 6 percent on Thursday.
Ambuja Cements is already in the F&O ban list, which has seen short-covering led buying and was up 5.5 percent on Thursday. Adani Group is the second largest cement company in India, after buying ACC and Ambuja Cements last year.
If derivative contracts in securities cross 95 percent of the market-wide position limit, they end up in the ban list, the NSE said.
“All clients/members shall trade in the derivative contracts of the said security only to decrease their positions through offsetting positions. Any increase in open positions shall attract appropriate penal and disciplinary action,” it said.
During the ban, traders are not allowed to take fresh positions in stocks but can start reducing their positions. The F&O ban rule helps reduce speculation in stocks.
The market-wide position limit, which is set by stock exchanges, is the maximum number of outstanding open positions (buy and sell) in the F&O contracts of a security. If the open interest in a stock crosses 95 percent of the market-wide position limit, its F&O contracts enter the ban period.
Normal trading in a security resumes only after the aggregate open interest across exchanges comes down to 80 percent or below the market-wide position limit, the NSE said.
