The bumper gains have been helped by a resurgent stock market. The BSE’s benchmark Sensex gained 56.4% since 1 April.
An LIC spokesperson said the insurer is a contrarian investor and focuses on long-term growth. “We are basically buyers when the market sells, and we are sellers when the market buys. This year has been exceptionally good. Along with good buying, leading to an increase in our equity portfolio, we have booked record profits in equity,” the spokesperson said in response to an emailed query.
Regulatory data shows LIC’s combined new business from individual and group single premium policies rose 22.4% to ₹95,840 crore in April-November. This, along with record profits from share sales, could increase interest in the LIC IPO.
LIC’s profits primarily come from sale of shares in the insurer’s large, non-linked portfolio, which includes traditional life insurance policies.
LIC’s record profits essentially mean: one, the insurer will be able to pay better bonuses and returns; two, it expands LIC’s investible surplus, which can provide vital support to stock markets at an uncertain time; and, three, the ability to generate such profits may attract new customers.