Mumbai: With high volatility in the equity market, contrarian player Life Insurance Corporation of India (LIC) has chosen to buy more stocks and sell less thereby making lower profits from its equity investments in the first quarter ended June 30, 2022 compared to the same period last year.
The public sector behemoth booked Rs 5,076 crore equity profit during April-June against Rs 11,368 crore a year ago.
Speaking at its earnings press conference, M.R. Kumar, chairman, LIC said, “As of June 30, 2022, our equity purchases were Rs 46,444 crore, sold stocks worth Rs 12,448 crore and therefore the net equity purchase is Rs 34,000 crore during the first quarter."
Raj Kumar, LIC’s managing director, said, “This year during Q1, the equity market was muted compared to the previous year, therefore the profit booking was less but at the same time, since we are a contrarian in our outlook ...we made net investment of equity worth Rs 34,000 crore.”
LIC posted a multi-fold rise in its net profit at Rs 682.9 crore in the June quarter against a mere Rs 2.94 crore in the year-ago quarter. On a sequential basis, its net profit fell from Rs 2,371.5 crore logged in the previous January-March quarter of FY22.
On an annualised premium equivalent (APE) basis the total premium was Rs 10,270 crore for the quarter. Of this 62.80 per cent (Rs 6,450 crore) was accounted for by the individual business and 37.20 per cent (Rs 3,819 crore) by the group business. Within the individual business the share of Par products on APE basis was 92.25 per cent and balance 7.75 per cent was due to non-par products.
The yield on investments on policyholders funds excluding unrealised gains was 7.74 per cent.