LIC sells 2.1% stake in NMDC for Rs 702 crore.

16 Mar 2023 , 08:04 AM

With an open market transaction, Life Insurance Corporation (LIC) decreased its exposure in the state-owned NMDC from 13.69% to 11.69%. At an average price of Rs 119.37 per share, the deal was completed.

After selling roughly 5.88 lakh shares in the national miner, LIC made Rs 702 crore. NMDC carries out iron ore exploration and production activities.

Along with NMDC, LIC has reduced its previous 10.1% shareholding in TIL Ltd to 8% now. 2.12 lakh shares were sold by the corporation in the open market, netting it Rs3 crore.

With 25% of its corpus set aside for equity investments, the state-owned insurer is one of the major domestic institutional investors. As of December 2022, LIC managed assets of roughly 44.34 lakh crore.

For the nine months ended December 2022, the yield on investments made with policyholders’ funds—excluding unrealized gains—was 8.58%.

Following a sharp decline in share prices, the insurer has recently been under scrutiny for its equity exposure to Adani group equities. Adani Enterprises, Adani Ports, Adani Total Gas, Adani Transmission, Adani Green Energy, ACC, and Ambuja Cement are among the seven group firms in which the insurer has stakes.

According to the disclosures filed to the markets, the total equity investment value of LIC in the Adani Group is Rs30,127 crore, or less than 1% of its total book value.

The Adani Group and LIC’s top executives recently met to discuss problems involving the conglomerate. Following the discussion, LIC Chairman MR Kumar declared himself to be more optimistic about the business potential of the Adani group.

Investments made by LIC in Adani stocks were briefly on the verge of a notional loss but have now recovered.

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