Govt selloff helps LIC buy Rs 44k cr stocks in Apr-Nov

TNN

Mumbai:

Life Insurance Corporation

(

LIC

) of India has bought shares worth Rs 44,000 crore in the first eight months of financial year 2017-18 — an increase of 13% over Rs 39,000 crore invested during the same period in FY17. The latest figure includes investments of over Rs 12,000 crore in government divestments.

A record 24.3% growth in premium from new policies during the same period enabled the corporation to step up its investments during the first half. Announcing the half-yearly performance, LIC chairman V K Sharma said that sales in November 2017 surpassed the “game-changing” sales in November 2016.

For the first half of FY18, the corporation’s total premium income stood at Rs 1.48 lakh crore — up 12% from the first half of FY17. New business premium grew 24% to Rs 68,224 crore, driven by its annuity plan Jeevan Akshay which has been repriced from December with lower returns. The corporation also launched a new cancer policy.

Total income, including earnings from its investments, stood at Rs 2.5 lakh crore — up 12.6% from same period last year. Total assets of the corporation rose 14% to Rs 27.26 lakh crore. Of this, Rs 16.57 lakh crore is in central and state government bonds and Rs 5.71 lakh crore in equity.

The corporation is also looking to expand its global business by converting branch operations in UK, Fiji and Mauritius into wholly owned subsidiaries. Speaking to TOI, LIC MD Usha Sangwan said that the corporation had a very positive experience from its wholly owned subsidiary in Singapore, which was getting business not just from people of Indian origin but also from the locals. “We are willing to put in the required capital,” said Sangwan.

Sharma said that for LIC, the government disinvestment programme was an opportunity as it got to make large investments in companies. “Our focus while making investments is not an immediate appreciation. We are more interested that the company should be around after 10-20 years,” he said. LIC has bought large chunks of shares in the government disinvestment in L&T and in the government’s offer for sale in the public offerings of New India Assurance and General

Insurance

Corporation of India.

Going forward, Sharma said that the corporation would go slow in investing in equities. “We are contrarians and we would like to book profit wherever we get the opportunity,” he said. However, LIC would support public sector banks in their fund-raising efforts, both in equity and bonds,” said Sharma. “We will be one of the investors but we will not be the only investor.”