EPFO Continues to Invest in Adani Ports, Adani Enterprises; Details

EPFO Meeting: The Employees’ Provident Fund Organisation, or EPFO, has continued to invest in two Adani Group companies, Adani Enterprises and Adani Ports, even after the port-to-energy conglomerate’s stocks were pounded rout following a damaging short-seller report.

According to a report in The Hindu on March 27, the subscribers are the captive investors because the two stocks are part of the Sensex and the Nifty that are tracked by EPFO-managed funds.

The EPFO, a retirement fund run by a trust under the Union labour ministry, administers the mandatory provident fund and a pension scheme of employees registered under the scheme.

The EPFO invests 15% of its corpus into exchange-traded funds, or ETFs, linked to Nifty 50 and the Sensex, reported The Hindu. The retirement fund body has also set aside 85% of its investment in companies into exchange-traded funds tracking Nifty 50.

Exchange-traded funds are a type of funds that follow a pre-defined set of rules to track a basket of securities that are used to raise capital in the markets.

As of March 2022, the EPFO had invested Rs 1.57 lakh crore in exchange-traded funds. The social security body made another investment of Rs 8,000 crore in the financial year 2022-’23, reported The Hindu.

After the hammering of the Adani group stocks, experts called for greater transparency and accountability in the investment decisions made by EPFO. Some have suggested diversifying the investment portfolio to yield better returns in the long term.

The 233rd meeting of the CBT, chaired by Union labour and employment minister Bhupender Yadav, was scheduled for March 25-26 but was pushed back.

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