Stock Market: Adani cash cow leads fight back; govt enters ring

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By S Jha

New Delhi, February 3: On a day when all seemed to have lost for the Adani Enterprises, the cash cow of the group – Adani Port – led a memorable fightback against the short-sellers to turn the tide. The government too stepped in to stem the growing noise by asking the SBI and LIC to give full details of the exposure to the beleaguered conglomerate.

While the SBI has a net exposure of Rs 27,000 crore, which the bank said is within the permissible limit, the LIC is already known to have invested Rs 23,000 crores. By the size of their capital books, the exposure to the Adani Group should be seen to be not excessive, the government sought to argue, with Finance Minister Nirmala Sitharaman too speaking on the issue for the first time.

Breaking the silence of the government, she said that India has a robust regulatory mechanism for the security markets. Sitharaman’s statement came after the details of the SBI and the LIC were put out amid mounting Opposition attack on the government. The Opposition stalled the proceedings of the two Houses of Parliament by pressing for the constitution of the joint Parliamentary Committee (JPC) probe in the Adani issue.

Meanwhile, Adani Port led the fightback, aided by the additional surveillance measures, which called for 100 per cent margins, and also multiple large trades, possibly of big hands stepping into stem the rot. Adani Enterprises covered all losses, of over 35 per cent during the day, to turn green, while Adani Port zoomed over seven per cent while retracing lower circuit losses. The turnaround in the beleaguered group also helped the indices stage a smart recovery, with both Nifty and Bank Nifty netting handsome gains.

But it was the HDFC twins – HDFC Bank and HDFC – who gave stability to the stock markets by rising by over three per cent each. Earlier in the day, IndusInd Bank had given stability to the Bank Nifty with over four per cent gains. Later, the SBI and ICICI Bank too joined the party to send the Bank Nifty trending.

The star of the day, however, was Titan, which gained over six per cent in the day. The scrip which had been lying at its low level of the recent times remained firm throughout the day. On the contrary, Divi’s Laboratory, a favourite of the investors in the recent years, tanked by over 11 per cent following its quarterly result. Besides, the metals were seen under stress. The foreign institutional investors against had a net sell of Rs 900 crore and more, but they were offset by their domestic counterparts.

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