(Bloomberg) -- Some shares that are part of billionaire Gautam Adani’s conglomerate took a beating for a second straight day on Wednesday as investors adjusted their holdings to reflect changes in the composition and weighings in the MSCI India Index, according to an analyst who publishes at Smartkarma.

Adani Green Energy Ltd., the group’s biggest firm by market value, led the rout on Tuesday, plunging a record 12% in trading volume about nine times the average of the past three months. Adani Total Gas Ltd. Adani Transmission Ltd. and Adani Power Ltd. fell by around 5% each. All these stocks extended losses in Mumbai trading on Wednesday.

MSCI Inc. published additions and deletions to its global indexes last month but the announcement didn’t detail changes to the weightings of individual stocks in its indexes. The changes took effect at close of trading on Tuesday and analysts said Adani Green’s weighting in the MSCI India Index was cut as it admitted new stocks. Emails to the Adani group and MSCI went unanswered outside business hours.

The moves underscore how shares of Adani’s companies are vulnerable to outsized swings, compounded by lower liquidity relative to those of stocks such as Reliance Industries Ltd., which backs the fortune of multi-billionaire peer Mukesh Ambani. 

“Adani Green soured sentiment for the group’s stocks as its weighting reduction in MSCI India Index took effect,” Brian Freitas, an analyst for independent research platform Smartkarma, said by phone. “Adani Power saw profit taking as it had run up ahead of its inclusion in the same index.”

A share rally in the companies of the ports-to-power conglomerate had taken Adani ahead of Ambani as Asia’s richest person earlier this year. While Adani remains among the top-10 richest people in the world, his wealth dropped by $3.7 billion yesterday, the Bloomberg Billionaires Index shows.

Following the change in Adani Green’s weight in the MSCI India Index, the stock could see outflows of about $220 million, Abhilash Pagaria, an analyst with Edelweiss Alternative & Quantitative Research, wrote in a note last month.

Shares of Adani Enterprises Ltd. and Adani Ports and Special Economic Zone Ltd. bucked Tuesday’s selloff but edged lower with the broader market on Wednesday.

Lack of analyst coverage and high valuations on some of the group’s stocks such as Adani Green, Adani Total Gas and Adani Enterprises have baffled some market participants in the past.

A small number of foreign funds own a significant portion of Adani Group shares, posing concentration risks, said Nitin Chanduka, a strategist with Bloomberg Intelligence. “Having a large chunk of shares held by a few funds also reduces the effectiveness of the public float, leaving stocks prone to asymmetric volatility.”

Freitas echoed these views.

“Its very difficult to get any information as there are hardly any analyst covering some of the group stocks,” he said. “Valuations versus peers show heaven and earth difference.”

(Updates prices. An earlier version correction the publication time of Edelweiss’ note.)

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