Adani crisis: Oppn seeks probe into LIC, banks exposure ‘endangering savings’
The stock rout in Adani’s beleaguered empire has intensified to more than $100 billion, as the fallout from Hindenburg Research’s fraud allegations pushed the Indian billionaire to pull a record equity offering and announce a review of his capital market strategy.
Both Houses of Parliament were adjourned till 2pm on Thursday amid disruptions over the Opposition's demand for debate on public sector investments in “companies losing market value”, an apparent reference to beleaguered Adani Group. Congress president and leader of Opposition in Rajya Sabha Mallikarjun Kharge had sent a formal letter to the chairman of upper house asking for suspension of regular business to “discuss the issue of investment by LIC, public sector banks and financial institutions in companies losing market value endangering the hard-earned savings of crores of Indians.”
Kharge said the Congress and other opposition parties want a Joint Parliamentary Committee or Supreme Court-monitored probe into the investments by public sector companies amid the ongoing market crisis triggered by the Adani stock rout.
“Either a Joint Parliamentary Committee or a team under the supervision of the CJI of Supreme Court should investigate this,” Kharge told reporters.
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Jairam Ramesh, Congress general secretary in charge of communications, tweeted, “Both Houses of Parliament adjourned today till 2pm because Govt did not agree to combined Opposition demand for an investigation into forced investments by LIC, SBI & other public institutions that have lost huge value in recent days endangering savings of crores of Indians.”
Meanwhile, Adani, in a rare address to shareholders, said his flagship firm withdrew its $2.5 billion share sale to insulate investors from potential losses. He said the board felt it would not be “morally correct” to proceed with the follow-on public offering (FPO).
“After a fully subscribed FPO, yesterday’s decision of its withdrawal would have surprised many. But considering the volatility of the market seen yesterday, our board strongly felt that it wouldn't have been morally correct to proceed with FPO,” Adani said.
“For me, the interest of my investors is paramount and everything is secondary. Hence to insulate investors from potential losses we have withdrawn FPO,” he added, insisting that the decision will not have an impact on the group's existing operations and future plans.