Indian state-owned insurance and investment company, Life Corporation of India has booked record equity trading profits of Rs. 25,000 crore in 2017-18, much above Rs. 19,000 crores a year ago as informed by sources.
LIC is known to adhere equity assets including mutual funds and shares worth Rs. 5 trillion (until the end of December) and profits approximately 5% of assets under management.
Meanwhile, the company is working on its annual accounts, the same will be published in May.
“The stock market has mostly been resilient in the past year and LIC has managed to get enough selling opportunities”, reported a source on the promise of anonymity.
Record-breaking profit from LIC is signaling a positive message if the insurer enhances its market exposure at the same time. This will mean not only a better credit bonus for the insurer but also a greater scope of investing more money in the market. A greater investment from LIC would translate to better liquidity improving NAV for unit-linked investment policy (ULIP) holders.
Kamlesh Rao, Chief executive and MD at Kotak Securities said,
LIC ‘s investment while they are witnessing growth is indicative of its positive sustenance in the market. This would favor stability rather than growth.
Money that is being invested by insurance companies in the market has witnessed an upsurge. At the same time, ULIP premiums too have shown robust growth in past two-three years and part of the money from them goes into the market.
The state-owned company has already bought equities worth Rs. 80,000 crore said the person cited earlier.