Choosing to slight the controversy around allegations documented in US short-seller Hindenburg’s report, state-run Life Insurance Corporation of India (LIC) has hiked its stake in billionaire Gautam Adani’s flagship entity Adani Enterprises in the March quarter.
Even as the market value of the Nifty stock was reduced to less than half in the quarter, LIC picked up 357,500 shares of the Adani company. Data from the stock exchanges clearly show the PSU insurer’s stake in Adani Enterprises up from 4.23% in the December quarter to 4.26% at the end of March.
LIC also increased stakes in Adani Transmission, Adani Green and Adani Total Gas during the quarter. On the other hand, the insurer trimmed investment in Adani Ports and Ambuja Cements. The shareholding remained the same in case of ACC. However, there is no clarity on the date of transactions — before or after the release of the Hindenburg report.
LIC’s investment in Adani Group companies, which was at Rs 30,127 crore at the end of January 2023, had become a political issue with Congress leader Rahul Gandhi alleging that SBI and LIC were forced to make investments to save the Adani group.
In its defence, LIC had said it invests from a long-term perspective and based on detailed due diligence. The PSU also claimed its total exposure in Adani Group was less than 1% of its total assets under management (AUM) at book value.
In the meantime, the number of small retail investors, as represented by those with investments of less than Rs 2 lakh, in Adani Enterprises went up about 3 times to 7.29 lakh. Retailers now own 3.41% of the company as compared to 1.86% in Q3.
Meanwhile, the Congress on Tuesday, questioned the government’s move alleging that LIC of India was being used to bail out the Adani Group.
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