Life Insurance Corporation of India Ltd,country’s largest domestic institutional investor, has acquired over 2 per cent stake in Adani group’s Adani Power Ltd (APL) and Adani Port & SEZ during the June quarter.
Over 2% stake in Adani PowerAccording to data available with the exchanges, LIC held a little over six crore shares or 2.05 per cent stake in Adani Power as on June 30. The total DII holding in the company is 2.57 per cent.
At the Wednesday’s closing share price of ₹28.70 on BSE, LIC’s holding in the company is valued at around ₹172 crore. During the quarter, the stock moved between ₹45 and ₹25.
Analysts see this is as a sign of building investor confidence for Adani stocks. “LIC's investment in Adani firms is a positive sign for the group. FIIs usually have speculative view about a company, but DIIs such as LIC come with long-term vision about the company. However, at a time when overall power sector is under stress, Adani Power is no exception. But the group has lined up major investments for solar power and port development. Hence, it creates optimism for future profitability,” said Dinesh Thakkar, CMD, Tradebulls Securities.
For LIC, Adani Ports & SEZ is the biggest attractive among the Adani group firms. From 1.45 per cent stake in September 2014, the domestic behemoth increased its stake to 3.41 per cent byJune-end. Current valuation of LIC’s holding in APSEZ stands at ₹2,289 crore.
However, the BSE data revealed that earlier also in March 2011, LIC held 1.13 per cent in APSEZ, but the same was successively reduced to 1.05 per cent in June quarter and then below 1 per cent from September 2011 onwards.
The insurance giant, however, remained quiet in Adani Enterprises Ltd (AEL) since 2014. LIC’s holding in AEL remained static at 1.53 per cent, since December 2014.