09-Feb-2024
2 mins read
Shares of the Life Insurance Corporation of India (LIC) witnessed a significant upswing, increasing over 4% to reach a new record high on February 9. This surge came in the wake of the state-run insurer’s announcement of robust earnings for the quarter ending December 2023. Demonstrating remarkable growth, LIC’s net profit soared by 49% year-on-year to Rs 9,441 crore. Additionally, the company’s net premium income saw a 4.67% increase YoY, amounting to Rs 1.17 lakh crore for the quarter.
The notable improvement in LIC’s performance can be attributed to a substantial increase in net income from investments and a steady growth in net premium income. LIC Chairman Siddhartha Mohanty expressed optimism about the future, emphasising the potential for expansion and improvement in various sectors. “This is just the beginning,” Mohanty remarked, hinting at a pipeline of products slated for release in the near future.
Dividend Announcement and Financial Highlights
In a further testament to its financial health, LIC declared an interim dividend of Rs 4 per share with a face value of Rs 10 each for the fiscal year 2024. The record date set for February 21 will determine the eligibility of shareholders for the dividend payment, with a total dividend outgo estimated at Rs 2,529 crore. The government, holding a 96.5% stake in LIC, stands to receive Rs 2,440 crore from this distribution.
Despite a dip in other income, falling to Rs 163.83 crore from Rs 209.75 crore year-over-year, LIC successfully reduced its gross non-performing assets (NPA) to 2.15% in the third quarter of FY24. This financial prudence comes amid positive remarks from the prime minister regarding the company’s performance, which contributed to the shares reaching an all-time high of Rs 1,145 on the NSE prior to the results announcement.
Market Capitalisation Milestone
The recent achievements have propelled LIC’s market capitalisation beyond the Rs 7-lakh-crore mark, positioning it as the fourth most valued company in India, surpassing Infosys. With a market cap of Rs 7.01 lakh crore, LIC now ranks behind only Reliance, TCS, and HDFC Bank in terms of market value, marking a significant milestone in the company’s journey towards financial excellence.