LIC share price today: Shares of Life Insurance Corporation of India (LIC) rose as much as 5% during the trading day on Wednesday. LIC shares, which have faced a steady decline since listing, were bought lower today. Shares of LIC jumped more than 5% intraday to reach Rs 709.70. However, later on it was unable to sustain the momentum and closed at Rs 688.55 with a jump of 2.11% on the NSE at the time of market close.
Earlier on Tuesday, shares of LIC had broken the continuous 10-day decline and closed with a gain of more than 1%. After today’s rally, the market capitalization of LIC rose to Rs 4.37 lakh crore. However, it is still around Rs 1.63 lakh crore less than the market capitalization at the time of listing – Rs 6 lakh crore.
LIC shares went public on May 17, 2022 and since then its value has fallen sharply. The issue price of the LIC shares has been set at 949 and is still around 25% lower than its issue price.
When LIC’s IPO was launched, analysts widely predicted that its stock price would not see much decline. However, he warned that the timing of LIC’s IPO launch was not the right one as the market was witnessing an all-out sell-off at that time. He had said that its effect can be seen on the shares of LIC. Apart from this, on the launch day of the LIC IPO, RBI had also announced a sudden increase in interest rates, which also worsened the sentiment. Let us tell you that since the launch of LIC IPO, the Nifty benchmark has fallen around 8% so far.
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What should investors do?
National brokerage firm Emkay Global advised betting on its private insurance company counterparts instead of LIC. The brokerage said in a note: “LIC has a dominant position in the market and its valuation is also reasonable, which we like. However, we rather prefer private sector counterparts, which have the potential for growth, profitability and RoEV. There are better prospects.”
On the other hand, Santosh Meena, Head of Research at Swastika Investmart Ltd, says now is the time to buy LIC shares. He said: “LIC has an advantage over its rivals. The company has strong brand value. It has a large network of insurance agents and an excellent distribution network. Apart from that, the the company’s share price fall, a lot on the agents.It also plans to address concerns such as over-reliance, shrinking market share, etc. In addition, the company’s action has been launched at 1.1 times its intrinsic value, which was already lower than that of its peers. This valuation became more attractive after the fall.”
Santosh Meena added, “One last thing we would like to mention is that investors should be aware that insurance is a long-term business. Therefore, the growth and pace of one’s wealth only happens over time. If the fundamentals are strong, then it’s a good time to buy with such a downside.
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