Shares of Life Insurance Corporation (LIC), India's largest life insurer, soared 5.30% in today's intraday to touch ₹900 apiece, a level not seen since its listing in May 2022. This also represents the stock's new 52-week high. The insurance behemoth was listed on the Indian stock exchanges on May 17, 2022, at ₹875.25 apiece as compared to the issue price of ₹949.
Post-listing, the shares experienced significant downward pressure until March 2023, reaching an all-time low of ₹530. However, a notable turnaround occurred in the subsequent months, with a particularly robust upward momentum observed in November, marking a gain of 12.83%.
This positive trend continued into the following month, with an impressive rise of 22.52%. In the current month, the stock has shown a further increase of 7.51% so far. At current levels, the stock is just 6.21% away from its IPO price.
From November until now, the company's market capitalisation has surged by ₹1.84 lakh crore, reaching the current level of ₹5.64 lakh crore.
In December, the government granted a one-time exemption to LIC to achieve the required 25% minimum public shareholding (MPS) within 10 years. The originally required to meet the 25% MPS rule by 2027.
The government held a 96.5% stake in the company at the end of Q3 FY24, while retail investors and domestic institutional investors each held 2.4% and 1% stake, respectively.
In November, LIC introduced a new non-par product, LIC Jeevan Utsav, featuring a combination of limited pay (5–16 years) with lifelong income. Analysts suggest that the non-par segment is value-adding, and an increase in its share can enhance LIC’s overall margins.
Regarding financials, the company reported a net profit of ₹17,469 crore in H1FY24 as compared to a net profit of ₹16,635 crore in the same period a year ago.
Its new business premium (individual) for H1FY24 jumped 2.65% to ₹25,184 crore from ₹24,535 in H1FY23. New business premium is the premium due in the first policy year of a life insurance contract.
The assets under management (AUM) increased to ₹47,43,389 crore in H1FY24 as compared to ₹42,93,778 crore in the same period last year, registering an increase of 10.47% year on year.
Disclaimer: The views and recommendations given in this article are those of individual analysts. These do not represent the views of Mint. We advise investors to check with certified experts before taking any investment decisions.
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