LIC loses $920 mn across Adani holdings in just 4 hrs!

The Life Insurance Corporation of India (LIC) has suffered a staggering $920 million (₹7,850 crore) loss in the value of its holdings (as of September 2024) in Adani Group companies -- ACC, Ambuja Cements, Adani Enterprises, Adani Ports & Special Economic Zone, Adani Total Gas, Adani Energy Solutions and Adani Green Energy -- in just four hours of trading (as of 1.20 PM) on November 21, following the U.S. indictment of Adani Group and its founder Gautam Adani. This sharp decline has slashed LIC's Adani portfolio value to ₹47,847 crore from the closing valuation of ₹55,694 crore recorded on November 19.

The losses highlight an even greater erosion in value when compared to LIC’s Adani holdings at the end of September 2024. Over the past two months, the insurance giant has witnessed a total loss of more than $1.85 billion (₹15,637 crore) in its investments, which stood at ₹63,482 crore as of September 2024.

Among the group companies, the insurer holds the largest stake (7.86%) in the ports company, followed by 11.46% across the two cement majors. However, LIC owns the least percentage holding (1.36%) in Adani Green, which has been in the eye of the storm.

The indictment has triggered a rout in Adani stocks, with significant declines observed across key holdings such as Adani Enterprises, Adani Ports, and Adani Green Energy, where market caps have seen sharp reductions. The massive valuation drop comes as a severe blow to LIC, which holds a 34.19% combined stake in various Adani companies.

The U.S. indictment accuses Adani and his associates of orchestrating a bribery scheme to secure government contracts, including India’s largest solar power project, projected to generate $2 billion in profits over two decades. These allegations compound previous concerns raised by Hindenburg Research, which accused the Adani group of accounting irregularities and stock manipulation earlier in 2023.