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The country’s largest insurer, Life Insurance Corporation, plans to pump in about Rs 50,000 crore in the equity market, taking its total investment, including in bonds, to Rs 3 lakh crore during the current fiscal.
“We plan to invest about Rs 50,000 crore in the equity market, while Rs 2.50 lakh crore in bonds,” LIC Chairman S K Roy told PTI.
He said LIC picked up stocks worth Rs 51,000 crore last fiscal and investments were made across sectors. Investments in bond market stood at Rs 2.4 lakh crore last fiscal.
Equity markets have rallied about 20 per cent so far this fiscal.
During the current fiscal, the life insurer has raised its stakes in many public sector banks, including United Bank of India, Central Bank of India and Bank of Maharashtra, by picking up preferential shares. Some more banks would make preferential allotment to LIC during the course of the year.
Disinvestment in PSUs
Besides, the Government has also announced the disinvestment roadmap for the current fiscal. The process of disinvestment in ONGC and NHPC, among others, has already been started.
Also, the Government is looking to sell 5 per cent stake in SAIL and 10 per cent each in RINL and HAL during the current fiscal, besides an outright sale of Tyre Corporation of India.
RINL IPO
The disinvestment of 10 per cent through an initial public offer (IPO) in Rashtriya Ispat Nigam Ltd is tentatively scheduled for completion in the current financial year.
LIC has been a key investor in the disinvestment initiative of the government.
In the Union Budget, the government has estimated to collect Rs 43,425 crore from selling stake in PSUs and another Rs 15,000 crore from the sale of residual stake in the erstwhile government companies.
During the first quarter ended June 30, 2014, LIC earned a total premium of Rs 14,016 crore, lower than Rs 14,295 crore in the year-ago period.
Life insurance sector with 24 players earned a total premium of Rs 19,699 crore in the April-June period of 2014-15.
LIC with 75 per cent market share collected Rs 41,441 crore from individual premiums and Rs 48,682 crore of group premiums, aggregating Rs 90,124 crore.
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