LIC posts bumper profits

Highest profit amng all companies.

Market at Ath still stock is 30-35% dwn from IPO lvls …why mrkt ignoring Lic?


Each company has its own problems, so despite market at ATH, if a business’s outlook is not looking bright, its price will be down, and if the business is strong, the price may not go down but it will consolidate for months.

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Its going to rock today for sure!!!

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Yup! That is due to a change in methodology of calculation of profits done by LIC. Although, it led to 6% gain in todays market opening!

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Everything has improved. Net interest income sees healthy uptick!

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LIC is more of a AMC play than an insurance play now.

It’s position in insurance is so dominate that the upside seems capped market share wise and private players taking share slowly in the coming years.

Yes market share is very high and has peaked, but with such low penetration in India and massive adoption ahead, you don’t really need market share uptick for good growth. And added AMC angle is a big reason many bought into this story.

LIC has the highest market share in the current market and the upside seems capped, but the current market does not cover the entire nation. insurance is barely limited to under 50% (1). This gives LIC a huge opportunity to capture the remaining 50% market. So the upside would have been capped in cases where the market had no scope for expansion. In the case of LIC, the market has a lot of scope for expansion and hence the upside cap might not be entirely true.
Secondly, the insurance penetration in India has only reached 3.76% in 2019 whereas the average in developing economies like Malaysia, china is ~4.5% (2). Hence more scope for LIC to get customers and increase the premium.

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In the past one month, the stock price of LIC has surged 20 per cent, as against 1 per cent decline in the benchmark index. According to media reports, the government aims to appoint a private sector professional as the first chief executive of LIC. Government plans to modernise the largest insurer after a disappointing stock market debut, the report added.

According to Business Standard report, the finance ministry has proposed a host of amendments to the insurance laws - from granting insurers a composite licence to allowing them to sell different financial products.

It’s a one-time profit!

No it is not one time.