LIC share price jumps over 5% after Q1 net profit swells multi-fold; should you buy?
- LIC posted a profit of ₹9,544 crore in Q1FY24, nearly fourteen-fold surge as against ₹683 crore in the corresponding period of the previous year.
Life Insurance Corporation of India (LIC) share price rallied more than 5% on Friday after the state-run insurance behemoth reported a multifold jump in its net profit for the quarter ending June 2023. LIC share price gained as much as 5.42% to ₹676.95 apiece on the BSE.
LIC posted a profit of ₹9,544 crore in Q1FY24, nearly fourteen-fold surge as against ₹683 crore in the corresponding period of the previous year.
The company’s total income increased to ₹1,88,749 crore for the June quarter as against ₹1,68,881 crore in the year-ago period.
Its net income from investments rose to ₹90,309 crore from ₹69,571 crore, YoY.
Total Premium Income was reported at ₹98,363 crore as compared to ₹98,352 crore, YoY.
However, total annual premium equivalent (APE) during the quarter fell 7% YoY to ₹9,532 crore. Participating policies' APE also declined 10.2% while non-par APE grew 21%. LIC's group policies fell 6.2%.
Brokerage firm Motilal Oswal says LIC has the levers in place to maintain its industry-leading position and ramp-up growth in the highly profitable product segments (mainly Protection, Non-PAR, and Savings Annuity).
However, it believes changing gears for such a vast organization require a superior and well thought out execution.
Motilal Oswal expects LIC to deliver a 15% CAGR in APE over FY23-25, thus enabling a 27% VNB CAGR. However, it expects operating RoEV to remain modest at 10.9%, given its lower margin profile than private peers and a large EV base.
At 10:00 am, LIC share price were trading 3.17% higher at ₹662.45 apiece on the BSE.
Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before taking any investment decisions.
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