Business

‘LIC stock performance must be gauged over medium term’

FILE PHOTO: A man walks past a hoarding of Life Insurance Corporation of India (LIC) after the press conference of the LIC initial public offering (IPO) launch in Mumbai, India, April 27, 2022.

FILE PHOTO: A man walks past a hoarding of Life Insurance Corporation of India (LIC) after the press conference of the LIC initial public offering (IPO) launch in Mumbai, India, April 27, 2022. | Photo Credit: Reuters

The LIC Board and management ‘have been continuously engaged’ in improving its performance parameters and the performance of the recently listed insurance behemoth’s shares must be analysed over a longer period, the Finance Ministry told the Rajya Sabha on Tuesday. 

“The market capitalisation of a listed entity changes on a continuous basis, based on a small volume of shares traded in the market,” Minister of State for Finance Bhagwat Kishanrao Karad told the Parliament in a written reply to a query from MP Raghav Chadha.

Mr. Chadha had sought to know the reasons why shares of LIC ‘wiped out over ₹1.5 lakh crore of investors’ capital, becoming one of the largest wealth guzzlers of recent times’. Mr. Chadha also asked why LIC shares were ‘continuously crashing’ in the market and the steps taken by Government to ensure that they ‘do not touch new lows every day’.   

Also Read

“The stock market performance of a particular stock needs to be analysed on a medium to long-term basis for a newly listed entity. There are several factors that affect the trading price of an entity such as geo-political factors, global and national macro-economic environment and perceptions of market participants on the prospects of a particular sector and/or the entity,” the minister said. 

“The LIC Board and management have been continuously engaged in strengthening and improving the performance parameters, keeping in view the interest of policyholders, shareholders and other stakeholders,” he emphasised. 

The government had sold 3.5% of its stake in LIC through an initial public offer this year which fetched about ₹21,000 crore at an issue price of ₹949 a share. Since its listing on May 17, the LIC stock has been trending down and closed at ₹675.50 apiece on Tuesday. 


Our code of editorial values

This article is closed for comments.
Please Email the Editor

Printable version | Sep 16, 2022 6:24:50 pm | https://www.thehindu.com/business/lic-stock-performance-must-be-gauged-over-medium-term/article65687106.ece