Most mutual funds have cut their holdings in Adani Group companies, but the largest investor in India’s public markets, Life Insurance Corp of India (LIC), has increased its holdings in four group stocks during the March quarter. This is in response to a sell-off crisis caused by a bad report from US-based short seller Hindenburg Research.
In the March quarter, the insurance company increased its shares in four of the six companies: Adani Green Energy, Adani Total Gas, Adani Enterprises, and Adani Transmission. However, it decreased its shares in Ambuja Cements and Adani Ports & Special Economic Zone.
At the end of the March quarter, ACC’s shareholding stayed the same at 1,20,33,771 shares, or 6.41 percent.
LIC has a stake in the Adani group.
According to data from stock exchanges, LIC’s share of Adani Enterprises went from 4.23 percent in the December quarter to 4.26 percent at the end of March.
As of March 31, 2023, the institutional investor owned 2,14,70,716 shares of Adani Green Energy, which is a 1.36 percent stake. This was 8 basis points more than the 1.28 percent stake in the Adani company that it had as of December 31, 2017.
The insurance giant increased its stake in Adani Total Gas by 6 basis points, from 5.96% at the end of the December quarter to 6.02% now.
The insurance company’s share of Adani Transmission went up by 3 basis points from one month to the next. LIC increased its stake from 3.65% to 3.68%.
LIC also cut its holdings in two group stocks: Ambuja Cements (down from 6.33 percent to 6.3 percent) and Adani Ports and Special Economic Zone (down from 9.14 percent to 9.12 percent).
LIC’s debt exposure in Adani group cos
Last month, Finance Minister Nirmala Sitharaman told the Lok Sabha that LIC’s debt exposure in Adani group companies dropped slightly from 6,347 crore on December 31, 2022 to 6,183 crore on March 5, 2023.
As of March 5, LIC owes 5,388.60 in debt to Adani Ports and SEZ. According to the written answer to the Lok Sabha, the exposure was 266 crore in Adani Power (Mundra), 81.60 crore in Adani Power Maharashtra Ltd-Phase I, 254.87 crore in Adani Power Maharashtra Ltd-Phase III, 45 crore in Raigarh Energy Generation Ltd, and 145.67 crore in Raipur Energen Ltd.
Hindenburg, a short seller based in the US, made a long list of accusations against the Adani group in January, including that there had been fraudulent transactions and that the share prices had been manipulated. This caused the shares of companies in the group to fall.
The group has said that the accusations are lies and that it follows all laws and rules about disclosure.
Source: Team CurrencyVeda
