LIC Stock Piggybacks On Adani Boom To Hit Highest In Over A Year

Life Insurance Corp’s (LIC) investment in the Adani Group companies has effectively doubled in value since the Hindenburg report-driven lows. Consequently, the insurer’s share price was also shooting up on Wednesday, extending strong gains this week.

What Happened: LIC’s holdings in Adani stocks have now reached a value of ₹56,629 crore. This marks an impressive recovery of ₹30,300 crore from the company’s lowest point, hit following allegations from short-seller Hindenburg.

The Adani Group experienced a surge in stock values of up to 20%, following the conclusion of a US agency investigation which found that the accusations made by Hindenburg Research against the Gautam Adani-led group were not applicable to Adani Ports.

This rebound was further propelled by several factors, including the Adani Group’s debt repayment, recent investment by GQG Partners, clearance from the US government, the Supreme Court’s confidence in an investigation into the group by the Securities Exchange Board of India (SEBI) and a ₹7 lakh crore capex plan.

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Currently, LIC holds stakes in seven Adani group companies, including 9.1% in Adani Ports and Special Economic Zone and 4.2% in Adani Enterprises. Since November, the market capitalisation of the Adani Group has seen a dramatic increase, soaring to over ₹13 lakh crore.

With most of the pressure on the Adani Group being eased this week, there may be even more upside in the offing for LIC’s stock as well.

Price Action: LIC’s share price was up 4.38% at ₹745.35 around noon on Wednesday.

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Posted In: Large CapNewsMoversTrading Ideasadani enterprisesAdani GroupAdani PortsLife Insurance Corporation of India