The Shares of Life Insurance Corporation of India LIC extended their fall for the fifth straight session. LIC's market cap has shrunk around 65,400 crore. The market value fell to 3,78, 740 crore today from Rs 4,44, 141 crore, closing value on January 24. The stock has tumbled 14.73 per cent in the past five days.
The plunge in LIC share price comes at a time when Adani Group shares are dwindling. Adani shares fell after a report by US-based short seller Hindenburg Research alleged that the Indian conglomerate had engaged in stock manipulation and accounting fraud schemes over the last few decades. Adani Group refuted the claim as baseless.
The state-owned insurer said it would seek clarifications from Adani's management on the short seller report. LIC held a 4.23 per cent stake in Adani's flagship Adani firm, Adani Enterprises while its exposure to Adani Ports stood at 9.14 per cent and 5.96 per cent in Adani Total Gas.
The insurance giant was a key investor in Adani's recent share sale. After high-net-worth individuals and institutional investors bid strongly, the Rs 20,000 crore follow-on public offering from Adani Enterprises was sailed through and fully subscribed. Retail investors and employees were not impressed with the offer, which received a poor to tepid response.
All of the 10 listed Adani Group stocks including recently acquired ACC, Ambuja Cements and NDTV fell sharply today after a report claimed that Credit Suisse had stopped accepting bonds of Adani companies as collateral for margin loans to private banking clients.
On the technical front, support on the LIC counter could be seen at Rs 588, an analyst said. The LIC stock price is now at 588. A daily close below this level could lead to Rs 520 on the daily charts. AR Ramachandran of Tips 2 said the resistance will be at 639.
The stock traded lower than 5 day, 20 day, 50 day, 100 day and 200 day moving averages. The RSI, the counter's 14 day relative strength index, came at 22.40. A level below 30 is considered oversold, while a value above 70 is considered overbought.
According to Trendlyne data, Adani Total has an average target price of Rs 865.67, suggesting a potential upside of 44.65 per cent.
More than eight times, 8.16 lakh shares on the BSE changed hands today, compared to LIC's two-week average volume of 96,000 shares. Turnover on the counter stood at Rs 50.14 crore, with a market capitalisation m-cap of Rs 3,78, 740.86 crore.
Indian equity benchmarks ended up being mixed amid highly volatile trade. The 30 share BSE Sensex pack rose by 158 points or 0.27 per cent to close at 59,708 and the NSE Nifty index moved 46 points or 0.26 per cent down to settle at 17,616, while the broader NSE Nifty index dropped 46 points or 0.26 per cent.
ACC shares plummeted up to 20% as the rout in Adani group stocks intensifies, according to Ambuja Cements.
Also Read | Adani Enterprises shares crash 35% as Credit Suisse halts margin loans on group bonds.