At Rs 44,664 cr, LIC's Adani portfolio value up 54% from Hindenburg lows

The value of Life Insurance Corporation’s investment in the Adani group companies went up to Rs 44,664 crore on Wednesday, marking a 54 per cent rise from the recent lows of Rs 28,988 crore.

According to data sourced from stock exchanges, a sharp turnaround has been witnessed in the stocks of flagship Adani Enterprises (AEL) and Adani Ports and SEZ (APSEZ). The value of the investment by LIC, which holds 4.3 per cent of Adani Enterprises, has increased to Rs 12,000 crore. Following the controversy triggered by the Hindenburg Research report, AEL shares hit their lowest on February 27 and have since made a sharp comeback, especially after GQG Partners bet $2 billion on Adani group stocks on March 2.  

LIC holds a 9.1 per cent stake in APSEZ – the value of which has jumped to Rs 14,144 crore (as on Wednesday), from Rs 9,102 crore reported on February 2. Last week, global financial services firm Jefferies came out with a detailed report on Adani group stocks, while giving a “buy” recommendation to investors on Adani Ports. The stock of APSEZ has already recovered and is trading at the pre-Hindenburg report levels.

The shareholding of LIC did not change between the December quarter and the March quarter, the exchange data shows. Growth in value also assumes that LIC has not changed its shareholding since April 1 this year.

LIC came under sharp attack after Hindenburg Research, a US-based short seller, in a report made several allegations against the Adani group. While the Adani group denied these allegations, the Supreme Court set up a six-member committee. The SC panel submitted a report to the top court saying it did not find any lapses on Sebi’s part. Since the report came out, Adani group shares witnessed a sharp rise. The group’s shares also got a boost with the Adani family selling stakes in group firms to raise funds to prepay their debt. 

Group companies are also taking steps to prepay debt and going slow on expansion projects. The conglomeration has also slowed down its acquisitions to focus on completing existing projects 

Three group companies, Adani Enterprises, Adani Transmission, and Adani Green Energy plan to raise funds by selling shares to investors.