If you are familiar with the Life Insurance Corporation of India, simply LIC, then let us try and look at some of the statistics aboutof LIC share price as its share market performance since its entry.
But before that, giving you a background of the making of LIC.
All About LIC
LIC, also known as Life Insurance Corporation of India is a state-owned insurance company in India. It is headquartered in Mumbai, under the ownership of the Government of India.
LIC was established in the year 1956 on the 1st of September, under the Life Insurance Act of India, passed by the then Parliament of India which made the industry of insurance in India nationalized.
The present-day Life Insurance Corporation of India is a result of the merger of more than 245 insurance companies and provident societies.
Now, it has 2048 branch offices all across India with 1381 satellite offices, 113 divisional offices, 8 offices at the zonal level, and one corporate office.
LIC has the following subsidiaries, which are LIC Housing Finance, LIC International Ltd, LIC Cards Services Ltd, LIC Mutual Fund Ltd, LIC Pension Fund Ltd, and IDBI Bank.
Journey in the Stock Market
Last year, LIC made a debut in the stock market. In the beginning, it did not remain at a good range but towards the end of the year, its price touched the Rs 700 mark for the first time since its launch as the price range for its offer was between Rs 902- Rs 949.
The IPO of LIC was the biggest that India had ever seen. It successfully generated the biggest-ever retail response to any IPO, making it the third largest in the entire world.
However, it did not turn out to be that good thus making its capitalization fall by 8%. After that, the stocks did not recover for a good long time. The volatile nature of the stock market did not help the stocks of LIC to recover well, thus making it susceptible to a downward trend.
Along with that, the rising inflation in the post-covid era with unmatching global prices got coupled with the changing sentiments of the investors made a huge negative impact on the LIC.
After that, it showed a continuous good performance in the headlines. This can be proven with the help of some facts.
- The shares of LIC rose by 4.1% to make it Rs 617.1.
Before this rise in the shares, the company announced a transfer of $22 billion from the fund of policyholders into the dividends fund or issuing bonus shares.
- The company also planned to transfer Rs 1.8 trillion to the fund of its shareholders.
These transfers in funds will indicate a sense of trust and confidence among the investors and will keep them interested as this will indicate a higher dividend payout shortly.
There are many other specifications along with that. All this has been possible due to some changes in government policy. Some of these were,
Change in Regulation
Earlier insurance companies were allowed to sell only one line of products as compared to the banks, who were allowed to sell both insurance and mutual funds. To make a change in this functionary, a proposal was made.
With the recent proposal of a single license for all insurance businesses, the government has made it possible for insurance companies to sell numerous products of insurance such as life insurance, health insurance, mutual fund, and investment management, with extreme flexibility.
Due to this change in regulation, now the insurance companies do not need the help of endorsers to help in selling out their products or different branches.
Better Business Performance
In the second quarter, LIC notified an increase of 27% in their quarter-on-quarter premium receipt. Along with that, income from various other sources like investments, assets under management, revenue, and net profit have improved simultaneously.
After the out of the quarterly results, the share price of LIC saw an increase of Rs 4o and by the end week of November, its share price started to rise steadily.
Change in Management System
When LIC came a participant in the stock market, it did not perform well as compared with the expectations due to which the government decided to change the system. It decided to appoint an executive from the private sector to be the CEO of LIC.
The government is also planning on recruiting private sector employees in LIC to change the scenario. This will increase the competitiveness among the employees and will enhance their performance level for the betterment.
Issue of Bonus
In October towards the end, the company made a huge announcement that it would be transferring a fund of $22 billion from its fund of policyholders to its dividend funds.
This made the investors excited enough to keep their interest in the company’s stocks.
- Today, the LIC share price is Rs 712.60 with the addition of Rs 28, a rise of 4.09% as previously it closed at Rs 684.60.
- In the housing finance sector, the LIC housing finance share price rose by 2.46% today at Rs 424.35 with the inclusion of Rs 10.20 more. Previously, the market was closed at Rs 414.15.
Wrap Up
The world of understanding the share market is not so easy but still, you can have some idea of its functioning, and how it has been progressing.
The market analysis has helped in knowing the know-how of the market position of LIC. And this will keep on fluctuating with changes in the behavior of the share market.
We hope that this write-up has helped you to understand the share market position of LIC, in the past, and present.
