LIC books record stock mkt gain ahead of IPO
MUMBAI: Life Insurance Corp. of India (LIC), which is working on the biggest public share sale in the country, booked record stock market profits of over ₹10,000 crore in the April-june period, two people aware of the matter said.
State-owned LIC, the largest insurer in the country, is also the biggest domestic investor in Indian markets, buying shares worth ₹90,000 crore in FY21 to reach a total stock market investment of ₹8 lakh crore at the end of the fiscal year.
“Being a contrarian investor, LIC has the advantage of booking profits from shares that were bought many years back when there was hardly any other insurer. This is possibly the highest June-quarter profit,” said a LIC official, one of the two people cited above. “We have sold shares worth around ₹20,000 crore in the first quarter of this tough year of the pandemic, from which a profit of more than ₹10,000 crore was made,” the person said seeking anonymity.
The record profit-booking in the June quarter is also expected to help the government attract more investors to the mega-ipo in the works.
In the June quarter, LIC cut its stakes in Housing Development Finance Corp. Ltd by ₹3,149 crore, according to Thursday’s closing price. The insurer also sold shares of HDFC Bank Ltd, Biocon Ltd and Hero Motocorp Ltd during the June quarter. LIC also sold shares in many other listed firms, but the shareholding patterns of only 17 such firms have been updated so far.
LIC’S profits primarily come from the sale of shares in its large non-linked portfolio, including traditional life insurance policies.
LIC plans to invest over ₹5 lakh crore in FY21, the two people cited above said on condition of anonymity.