Is LIC’s stock price jump just a dead cat bounce?

The state-owned insurer has been using the surplus in its non-participating policy pool to boost its bottom line, with little real change in its financials.

On 11 August, the Life Insurance Corp. of India stock rose 5% intra-day, reacting to the state-owned insurer’s first quarter results of the 2023-24 fiscal announced the previous evening. In it, the company reported that its net profit for the April-June period was up 14-fold over the corresponding period in the previous fiscal, to Rs 9,544 crore. 

This run-up in profit isn’t a one-off. For the financial year 2022-23, LIC’s first as a listed entity, the insurer posted a profit of Rs 35,997 crore, as against Rs 4,043 crore in the previous year. In just the March-ended fourth quarter, the …

Author

T Surendar

Surendar helps lead the newsroom at The Morning Context as executive editor. Over the years, Surendar has worked in industries from pharmaceuticals to diamonds, as well as a stint as an equity analyst. In his long career as a business journalist, he has led teams at The Times of India, India Today and Fortune India. He was part of the founding team at Forbes India and interned at and published in The Times, London.

Executive Editor

surendar@mailtmc.com

Mumbai