Life Insurance Corporation, the country’s largest life insurer, will exceed the Rs 40,000 crore target for investment in equities in the current financial year, said Chairman, S.K. Roy.
The insurance company has made approximately Rs 32,000 crore worth new equity investments till date in the current financial year, he said while speaking to reporters on the sidelines of a FICCI summit.
"Investment is not a target. It is an estimate made in the beginning of the year. So far in this year we got more opportunity to buy than we had anticipated. If there is similar opportunity in the second half of the year, then in all likelihood we will cross the target of Rs 40,000 crore by some margin," Roy said.
"If the market is high, we will see how much we can sell for profit-booking. If the market dips, that gives us a buying opportunity. In that sense, we have got both opportunities in abundant measures this fiscal," Roy said.
He added that sectors like banking, pharma, some portion of infrastructure and auto look attractive options for investment.
Roy also said the insurer is witnessing good opportunity in the debt space. "There is an improvement in this segment also. We are getting good proposals which are under consideration. I am sure this segment will look up by the end of the year," he said.
On the growth in premium witnessed by the company, Roy said the second quarter had seen excellent growth in premium collection.
"Q2 had been an outstanding quarter for us... July was a good month with decent growth. In August, we have seen outstanding growth. I am confident of achieving Rs 33,000 crore of new premium collection in this fiscal. Up to October 15, we have achieved Rs 15,000 crore," Roy said.
Roy said the state-run life insurer is faced with a herculean task of training its 12 lakh agents for selling revamped life insurance products compliant with the new product guidelines which will be implemented from 2014.
According to him, however, the new product guidelines will not hit the business of the insurance behemoth in the fourth quarter, where it typically sees the highest sales.
He said the state-run life insurer has set a target of recruiting 2 lakh agents this year, out of which it has already recruited 85,000 agents so far.
Roy also said the life insurer is making a conscious effort to increase its representation in the board of companies where it has substantial holdings.
“Companies where we have significant holding and don’t have nominees on the board, I can say that since the beginning of this financial year, we have been engaging with those companies and we have been getting a positive response from them. I am sure soon, our representation in these companies will start increasing in the near future,” Roy said