LIC suffers a ₹12,000 crore Loss in a Single Day Across Seven Adani Stocks

The Life Insurance Corporation of India (LIC), the largest domestic institutional investor in the country, witnessed a significant decline in the value of its holdings in seven Adani Group companies. On Thursday, November 21, the total drop amounted to nearly ₹12,000 crore in a single trading session, attributed to a sharp downturn in the group’s stock prices.

The plunge in shares of the Gautam Adani-led conglomerate, reaching up to 20%, followed charges by U.S. prosecutors accusing the billionaire of involvement in a $250 million bribery case.

As of the end of September 2024, LIC's portfolio included stakes in seven Adani entities: Adani Enterprises, Adani Ports, Adani Green Energy, Adani Energy Solutions, Adani Total Gas, ACC, and Ambuja Cements. The combined value of LIC’s investments in these companies dropped by ₹11,728 crore.

The steepest decline for LIC was seen in Adani Ports, with a reduction of ₹5,009.88 crore, followed by a ₹3,012.91 crore drop in Adani Enterprises. The insurer’s holdings in Ambuja Cement decreased by ₹1,207.83 crore.

Further losses included ₹807.48 crore in Adani Total Gas, ₹716.45 crore in Adani Energy Solutions, ₹592.05 crore in Adani Green Energy, and ₹381.66 crore in ACC.

Bribery Allegations Against Adani

According to Reuters, U.S. authorities accused Adani and seven others, including his nephew Sagar Adani, of paying approximately $265 million in bribes to Indian officials. These payments allegedly secured contracts valued at $2 billion in profits over two decades, enabling the development of India’s largest solar power project.

The U.S. Attorney’s Office for the Eastern District of New York unsealed a five-count indictment against Gautam S. Adani, Sagar R. Adani, and Vneet S. Jaain. The charges include conspiracy to commit securities and wire fraud, along with other securities fraud violations. The indictment accuses the defendants of misleading U.S. investors and global financial institutions in a multi-billion-dollar scheme.

Invest in Indian Markets and Unlock Future Potential With 5paisa!

Open Account Now

Adani Group Stocks Plummet

Following these allegations, shares of Adani Energy Solutions hit the lower circuit limit of 20%, closing at ₹697.70 on Thursday. Similarly, Adani Enterprises and Adani Ports, both part of the Nifty50 index, were down 19% and 15%, respectively, by midday.

Other Adani companies, including Adani Green Energy, Adani Total Gas, Adani Power, Adani Wilmar, ACC, Ambuja Cements, and NDTV, recorded losses ranging from 7% to 18%.

The collective market capitalization of Adani Group companies eroded by ₹2 lakh crore on the same day.

These developments come nearly two years after a report by U.S.-based short-seller Hindenburg Research alleged improper use of tax havens and stock manipulation by the Adani Group. The conglomerate has consistently denied these claims.