The Life Insurance Corporation of India‘s (LIC) debt exposure to the Adani Group has come down, the government informed the Lok Sabha on Monday.
“The LIC has informed that its debt exposure to the Adani Group was ₹6,347.32 crore and ₹6,182.64 crore, as on December 31, 2022 and March 5, 2023, respectively,” Finance Minister Nirmala Sitharaman said in a written response. Further, she said the five public sector general insurance companies have informed that they do not have loan/credit exposure to the Adani Group.
When asked about exposure by banks, Sitharaman said the RBI Act bars giving information about specific borrowers. However, she quoted banks who have informed that loans are sanctioned after assessing the viability of projects, prospective cash flows, risk factors and availability of adequate security, and repayment of loans are ensured by the revenue generated by the project and not by the market capitalisation of the company.
Also read: LIC’s investment in Adani Group erodes, close to cost now
Earlier on January 31, LIC had said its total holding in the Group under equity and debt is ₹35,917.31 crore, as on December 31, 2022. The total purchase value of equity, over the last many years, under all the Group companies is ₹30,127 crore and the market value for the same as of January 27 (market close) was ₹56,142 crore.
As a percentage of the total assets under management of ₹41.66-lakh crore, LIC’s exposure in the Adani Group is 0.975 per cent at book value. Further, the LIC said all its investments are carried out as per the statutory framework of the Insurance Act and the IRDAI investment regulations, and are guided by a detailed governance mechanism.
In response to another question, MoS Finance Pankaj Chaudhary said investigation pertaining to the import of power generation, power transmission and infrastructure (port & SEZ) equipment by the Group has been concluded by the Directorate of Revenue Intelligence and a report has been submitted before the relevant judicial authorities. “As regards case pertaining to imports of Indonesian coal by the Adani Group, investigation by DRI has not reached finality,” he said.
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