LIC Shares Surpass Issue Price Mark, Soar 4% for First Time

by | Jan 30, 2024 | 0 comments

LIC Shares Cross Issue Price for the First Time

Life Insurance Corporation of India (LIC) saw its shares cross the initial issue price mark on January 30. This milestone achievement came after the Reserve Bank of India (RBI) allowed LIC to increase its stake in HDFC Bank. The shares were initially priced between Rs 902 to Rs 949 during the May 2022 IPO but were listed at Rs 867 on the National Stock Exchange, marking a discount.

Rebound in LIC Shares Post-November

After its listing, LIC shares experienced a downward trend, declining by 26 percent from the listing price until November last year. However, a significant turnaround happened post-November. These Shares have gained 55 percent in just two months, a remarkable recovery.

RBI’s Approval for LIC’s Increased Stake in HDFC Bank HDFC Bank announced that the RBI permitted LIC to raise its stake to 9.99 percent by January 24, 2025. As of Q3FY24, LIC already owned 34 crore shares of HDFC Bank, equating to a 5.19 percent stake. This approval from RBI enables LIC to acquire an additional 4.8 percent stake.

Market Reaction to LIC’s Increased Stake in HDFC Bank Experts in the market see LIC’s move to buy an additional 4.8 percent stake in HDFC Bank as strategic, especially since the bank’s stock valuation became attractive after a significant fall.

LIC’s Financial Performance and Stock Trading LIC reported a 50 percent drop in net profit year-on-year in Q2FY24, amounting to Rs 7,925 crore, compared to Rs 15,952 crore in the same period last year. This decrease was attributed to a change in accounting policy regarding the transfer of the amount (Net of Tax) in September 2022, making the year-on-year profit figures incomparable.

At 13.45 pm on the National Stock Exchange, Life Insurance Corporation of India (LIC) shares were trading up by 2.89 percent at Rs 942.05, reflecting positive investor sentiment.

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