Mutual funds are moving away from Adani Group companies. In this case, LIC is increasingly investing in the Adani Group.
Adani Group companies reviewed by The Indian Express put the total value of LIC in these seven companies at Rs 74,142 crore till date. This is 3.9 percent of Adani Group’s total market capitalization of Rs 18.98 lakh crore.
LIC’s stake in Adani group companies stands at 7.8 per cent of its own equity portfolio of Rs 9.3 lakh crore as of June 30, 2022, at Thursday’s closing price.
How LIC shareholding in Adani group companies increased from September 2020 to September 2022.
Major Adani Enterprises LIC’s stake rose less than 1 percent to 4.02 percent. Adani Total Gas rose less than 1 percent to 5.77 percent.
In Adani Transmission, LIC’s stake rose to 3.46 percent from 2.42 percent.
In Adani Green Energy, it increased to 1.15 percent from less than 1 percent.
The only exceptions are Adani Ports, where LIC’s holding is 9.61 per cent, and two other companies, Adani Power and Adani Wilmar, which hold less than 1 per cent.
Reflecting this increase in shares and share prices, the value of LIC’s stake in Adani Group companies and LIC’s holdings have increased 10 times since September 2020.
What are the reasons?
In the insurance sector, LIC is investing in Adani Group companies. As of December 1, 2022, its Rs 74,142 crore is 98.9 per cent of the overall insurance industry investment in the group.
LIC’s investment is five times the value of holdings of all equity mutual funds in Adani group companies.
As on October 31, 2022, just Rs 15,701 crore or just 1 per cent of the equity funds’ total assets of Rs 15.22 lakh crore are invested in Adani group companies. It is on stock basis as of September 2020.
In the last two years, the group’s market capitalization has also grown almost seven-fold to Rs 18.98 lakh crore as on September 30, 2020, from Rs 2.78 lakh crore as on September 30, 2020, as LIC bought stakes in Adani group companies.
Tata Market Investment
In this case, Sensex has increased by 1.66 times. It closed at 63,284 points on Thursday.
Meanwhile, Indian Express sent an email to an LIC spokesperson seeking a response on the insurer’s significant purchase of Adani shares. No response was forthcoming.
Incidentally, LIC holds 3.98 per cent of the total market capitalization of Tata group companies (Rs 21.91 lakh crore), and mutual funds collectively hold 4.9 per cent.
Similarly, while LIC holds 6.45 per cent stake in RIL (market cap Rs 18.42 lakh crore), mutual funds hold 5.68 per cent.
Tata Group companies and Adani Group are the top two in terms of market capitalization.
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