Has the losing streak of LIC finally ended?
The shares of Life Insurance Corporation which were down by almost 30 per cent from the issue price have finally shown some signs of recovery.
LIC IPO was India’s biggest IPO but unfortunately did not meet all the expectations and the stock hit its 52-week low at Rs 663.95 on June 14 2022. On Wednesday, even in a volatile market, the shares were trading 2.60 per cent higher indicating some improvement. At 1:55 pm the scrip was at Rs 691.70, up by 17.50 points.
LIC has increased its stake in Hindustan Unilever Ltd, Hero MotoCorp and non-banking finance company Capri Global Capital from the period from February to June.
As of June 13 2022, the stake of LIC in HUL increased from 4.995 per cent to 5.008 per cent, the stake in Capri Global Capital has increased from 5.043 per cent to 7.059 per cent and that in Hero MotoCorp has raised from 9.163 per cent to 11.256 per cent.
On Tuesday, it also announced its Dhan Sanchay plan which is a non-linked, non-participating, individual, savings life insurance plan which generates savings along with protection.
Insurance market in India is still in its nascent stage and has huge growth potential. In comparison to its peers, LIC has the advantage in terms of brand value, a network of agents and distribution. The company's share was also issued at a lower price to the embedded value of 1.1x in comparison to its global as well as Indian peers. As per investors, the investor behemoth has the potential to grow in the long run.
Only time will tell, whether investors should have bought in this dip or should they should have waited!