LIC says will seek explanation from Adani on stock crisis

The stocks of the various companies of the port-to-energy conglomerate have seen a massive sell-off after the US-based short-seller Hindenburg Research accused it of “brazen stock manipulation and accounting fraud”. The Adani group has denied the allegations.

LIC's investment into Adani group firms' stock has come under criticism by the opposition parties as well as investors. (Express Photo: Nirmal Harindran)

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State-run insurer Life Insurance Corporation of India (LIC) Thursday said it will reach out to the Adani Group for an explanation on the recent decline in share prices of its companies and its plan to deal with the crisis.

The stocks of the various companies of the port-to-energy conglomerate have seen a massive sell-off after the US-based short-seller Hindenburg Research accused it of “brazen stock manipulation and accounting fraud”. The Adani group has denied the allegations.

Read | Adani stock rout resumes as MSCI says it’s reviewing free float

“We will be calling them (the Adani Group management) some time just to know their business profile, what they are planning to do and how are they managing the whole thing around what has happened. If they can throw some light on that, it will help us understand what is going on,” LIC Chairman M R Kumar told reporters.
To a query on the current market value of the insurer’s investment in the Adani Group, the chairman said: “I will not be able to give you the market value as of now, but the book value is the same. We are still in the green.”

Also Read | MSCI probes free-float, Adani sell-off resumes

On January 30, LIC said its total holding under equity and debt under the Adani group was Rs 35,917.31 crore as at December 2022-end.
The total purchase value of equity, purchased over many years, under all the Adani group companies stood at Rs 30,127 crore and the market value for the same at the close of market hours on January 27, 2023 was Rs 56,142 crore, it said. The total amount invested under Adani group amounted to Rs 36,474.78 crore as on date.

Read | Norway wealth fund has sold its stakes in Adani companies

LIC’s exposure to the group is at 0.975 per cent of its total assets under management (AUM) at book value.

To a query on whether LIC has reduced its exposure to the group, LIC chairman replied in the negative. “We buy and hold for the long term. We have not reduced exposure (to the Adani Group),” Kumar said.

LIC net profit soars to Rs 6,334 cr in q3

Mumbai: LIC Thursday reported a net profit of Rs 6,334 crore in the December quarter as against Rs 234. 9 crore a year ago. The insurer’s AUM registered a growth of 10.5 per cent to Rs 44.34 lakh crore on December 31, 2022 from Rs 40.12 lakh crore the previous year.