InvestorQ : With Vedanta, Hexaware, and Adani Gas likely to get de-listed, what are the risks for shareholders?
Juvina Maggie made post

With Vedanta, Hexaware, and Adani Gas likely to get de-listed, what are the risks for shareholders?

Answer
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Anamika Sodhani answered.
3 months ago


There are broad risks on the valuation front and also that the minority shareholder interests may not be adequately served. In fact, Fitch has warned that delisting could create governance issues for companies through concentration of ownership and key man issues. Vedanta, Adani Power and Hexaware announced delisting plans citing operational flexibility as the reason for delisting. But, clearly the reason appears to be that companies do not see much value addition in remaining listed entities in the current challenging market conditions. Fitch has expressed apprehensions that such delisting moves could focus too much power in the hands of the promoter and make these boards less transparent. In the process, disclosure practices and governance standards could be compromised.