LIC has experienced a substantial 59% surge in the value of its investments in Adani Group companies during the fiscal year 2023-24.
· During the previous fiscal year, LIC found itself under intense scrutiny due to its strategic investment decisions in the Adani Group amidst a charged political atmosphere.
· According to data from stock exchanges, LIC’s investments in seven Adani Group companies have witnessed a significant upswing, soaring from Rs 38,471 crore as of March 31, 2023, to Rs 61,210 crore by March 31, 2024.
· The surge in LIC’s investment value wasn’t confined to a select few companies within the Adani Group; it spanned across various sectors.
· In the year since the Hindenburg report, Adani Group has solidified its position as India’s premier infrastructure conglomerate.
In a notable development within the financial landscape, the state-owned insurance behemoth, LIC (Life Insurance Corporation of India), has experienced a substantial 59% surge in the value of its investments in Adani Group companies during the fiscal year 2023-24. This surge in investment value comes amidst a remarkable recovery phase for the Adani conglomerate, which had faced significant challenges following a damning short seller report.
According to data gleaned from stock exchanges, LIC’s investments in seven Adani Group companies have witnessed a significant upswing, soaring from Rs 38,471 crore as of March 31, 2023, to an impressive Rs 61,210 crore by March 31, 2024. This notable increase translates to a substantial increment of Rs 22,378 crore, underscoring the resurgence of investor confidence in the Adani Group’s prospects.
During the previous fiscal year, LIC found itself under intense scrutiny due to its strategic investment decisions in the Adani Group amidst a charged political atmosphere. Allegations of stock manipulation, fueled by the Hindenburg report, added to the scrutiny. However, Adani Group vehemently denied any wrongdoing, paving the way for its eventual resurgence.
In a strategic move, facing political pressure, LIC tactically reduced its exposure to two of the Adani Group’s flagship companies, Adani Ports & SEZ and Adani Enterprises. Despite this reduction, the shares of these companies witnessed a remarkable surge by 83% and 68.4%, respectively. Surprisingly, despite trimming its ownership, LIC’s investments experienced a robust 59% surge in value in FY24, as per data available from stock exchanges.
Interestingly, while domestic investors faced hesitation amid political pressures, overseas investors wasted no time seizing the opportunity presented by the Adani Group’s rebound. Heavyweights such as the Qatar Investment Authority, Abu Dhabi-based IHC, French giant Total Energies, and US-based GQG Investment collectively poured close to Rs 45,000 crore into Adani stocks, signalling renewed international confidence in the conglomerate’s future prospects.
The surge in LIC’s investment value wasn’t confined to a select few companies within the Adani Group; it spanned across various sectors. Notably, Adani Green Energy Ltd witnessed the most significant rise, with its value more than doubling to Rs 3,937.62 crore in just one year. Additionally, LIC saw value appreciation in its investments in Adani Total Gas Ltd, Ambuja Cements, and ACC, further bolstering its overall portfolio performance.
In the year since the Hindenburg report, Adani Group has solidified its position as India’s premier infrastructure conglomerate. With a laser focus on spearheading the nation’s green energy transition alongside a formidable presence in critical sectors such as airports, ports, data centers, and roads, Adani has emerged stronger than ever, leaving behind the shadows of past controversies and attracting renewed investor interest both domestically and internationally.
(With inputs from agencies)
