According to a report from Economic Times, India’s leading insurance company, Life Insurance Corporation of India (LIC), has increased its holdings in four Adani Group stocks during the March quarter, despite the allegations made in the explosive Hindenburg report. 

LIC increased its holdings in Adani Enterprises to 4.26% in the March quarter from 4.23% in the previous quarter, acquiring 357,500 shares. LIC also raised its stakes in Adani Transmission, Adani Green and Adani Total Gas. Meanwhile, the insurer reduced its stakes in Adani Ports and Ambuja Cements. 

The number of small retail investors in Adani Enterprises increased to 7.29 lakh, compared to 1.86% in Q3. LIC’s investment in Adani Group companies, at INR 30,127 crore as of January 2023, has become a political issue.

The report also notes that Hindenburg Research’s allegations of accounting fraud, stock manipulations, and money laundering against the Adani group had prompted a 50-80% fall in Adani Group stocks. While mutual funds mostly trimmed their stakes, LIC upped its stakes in four group stocks, albeit marginally. 

The Adani Group, based in the United States, was accused by Hindenburg Research of engaging in accounting fraud, stock manipulation, and money laundering. However, the group refuted these allegations and denied any wrongdoing. Subsequently, the Supreme Court directed the market regulator Sebi to investigate the group’s offshore transactions. Additionally, in order to reduce debt and fulfil other obligations following the cancellation of its FPO due to the Hindenburg report, the Adani Group secured a fundraising exercise by entering into a Rs 15,000 crore deal with GQG Partners, a US-based company.

LIC’s total exposure in Adani Group was less than 1% of its total assets under management (AUM) at book value, and the insurer had stated that it invests from a long-term perspective and based on detailed due diligence. Adani Enterprises is one of the four companies in which the promoters had pared their stake. Shares of Adani Enterprises were trading flat at INR 1,800.55 on Tuesday and are down 57% from their all-time high of INR 4,189.55.