Extending losses for the fifth straight day, LIC Housing Finance today went into a tailspin and tanked over 7 per cent on BSE on retirement fund manager EPFO's decision to suspend further investments in the company till the CBI inquiry in the bribes-for-loans scam is over.
The government today said Employees Provident Fund Organisation (EPFO) will not invest any funds in the LIC Housing Finance, a subsidiary of the largest insurer Life Insurance Corporation (LIC), till the CBI enquiry is over.
Following the news, the scrip of LIC Housing plunged 7.26 per cent to close at Rs 894.10. During the day it had tumbled 8.41 per cent hitting a month low of Rs 883 on BSE.
In five consecutive sessions LIC has reported a decline of 15 per cent.
Similarly, on the National Stock Exchange, the stock settled the day at Rs 878.70, down 8.95 per cent.
CBI had last month arrested LIC Housing Finance CEO Ramachandran Nair for allegedly colluding with the real estate firms to sanction large scale corporate loans.
In terms of volume, over 37 lakh shares of the company were traded on the two bourses.
The EPFO till date has invested Rs 454 crore in the bonds of the LIC Housing Finance Company while under the current investment norms its exposure can go up to Rs 846 crore.
Meanwhile, the BSE barometer Sensex ended the day at 19,242.36, reflecting a loss of over 454 points or 2.31 per cent.