Before Sebi report, entity takes ₹600 cr AEL position

A single market participant took a derivatives position worth an estimated ₹600 crore in Adani Enterprises Ltd (AEL), flagship of the Adani Group and a Nifty 50 stock, just days before India’s markets regulator submitted its status report on the Adani probe to the Supreme Court on 25 August.

- Ram Sahgal

While it’s not known whether the position is a hedge or a punt, market experts said such positions are normally taken in anticipation of a sharp price move based on an event.

Designated ‘Client 1’ by National Stock Exchange (NSE), the participant initiated a position of 2.24 million shares, or 3.04% of AEL’s marketwide position limit (MWPL) of 73.7 million shares on 22 August. Based on the closing price of the AEL active futures contract on that day, the cost of the position is ₹607.25 crore.

However, the equivalent cash margin a client has to put up to trade an AEL derivatives contract is 65%, or ₹395 crore, in this case. This position is termed open interest, as it signifies an outstanding long or short position.