24-Nov-2023
2 mins read
In a remarkable surge, shares of Life Insurance Corporation of India (LIC) witnessed a staggering 9.71% jump. This significant uptick was attributed to the company’s strategic plans to introduce 3-4 new products in the upcoming months. These initiatives are aimed at bolstering growth in their new business premium (NBP), according to LIC Chairman Siddhartha Mohanty.
Driving Growth Through Innovative Offerings
Mohanty said that LIC anticipates double-digit growth for the current financial year, a goal they plan to achieve by unveiling compelling new products. The company’s intention to launch a new product in the first week of December is particularly noteworthy. This product is expected to garner substantial attention in the market, boasting features like loan facilities and premature withdrawal options.
Empowering Policyholders and Shareholders
Mohanty emphasized the appeal of guaranteed return products to both policyholders and shareholders. He highlighted the dual benefit these offerings provide, recognizing that many shareholders also hold policies. This dual advantage aligns the interests of both stakeholders, making such products especially attractive.
Reversing Market Underperformance
Despite this recent surge, LIC had been trailing in the market, delivering only approximately 3% returns in the last year compared to the 8% returns by the Nifty. Moreover, its performance in 2023 witnessed a concerning 9% erosion in prices compared to the previous year.
Sector-Wide Uptick: GIC and NIACL Shares Soar
Notably, the surge in LIC’s stock was mirrored across the sector. General Insurance Corporation (GIC) and the New India Assurance Company (NIACL) also experienced significant spikes in their stock prices.
GIC’s shares soared by 14%, hitting a fresh 52-week high of Rs 301.80. NIACL, too, witnessed an impressive uptick of over 17%, reaching a new 52-week high of Rs 208. The surge occurred after the insurer announced scheduled meetings between analysts, institutional investors, and senior management in Mumbai on November 29. The stock has surged by an impressive 36% in just the last five trading sessions.
Final Thoughts: Revitalizing Market Confidence
The recent surge in LIC’s stocks, coupled with similar upticks in other public sector insurance companies, reflects renewed market confidence. These strategic initiatives and promising growth projections signal a potentially transformative period for these entities, marking a shift from previous market underperformance to a more buoyant trajectory.