On May 24, India’s largest life insurer LIC reported an impressive growth for the fourth quarter of Financial Year 2022-23. The Consolidated Profit After Taxes (PAT) of LIC stood at an impressive Rs 13,190.79 crores. The company has seen a 5.5 folds year-on-year rise of 447.47%. Notably, for the financial year 2021-22’s fourth quarter, LIC’s PAT was only Rs 2,409.39 crores. The company’s growth for Q4 was 107.77%.
The company earned a consolidated net premium income of Rs 1,32,233.21 crores. It has come down by 8.27% compared to Q4 of the previous year which was Rs 1,44,158.84 crores. However, compared to Q3 of FY 2022-23, the company saw a growth of 17.7%. The net premium income of the company has declined by 8.34% on a year-on-year basis but rose by 17.87% on a quarter-on-quarter basis.
On the sidelines of the impressive performance by the company, the board of directors have recommended a dividend of Rs 3 per equity share for the FY 2022-23. Chairperson of LIC Siddhartha Mohanty said, “Our results demonstrate the resilience of our business, built in every nook and corner of the country, over a period of more than six decades. Our efforts towards enhancing the share of non-par products in the overall product mix are bearing fruits.”
In FY 2021-22, the company’s profit was Rs 4,043.12 crores. It has increased to Rs 35,397.40 crores in FY 2022-23. Furthermore, the Value of New Business on the gross bases of the company has increased from Rs 9,920 crores in FY 2021-22 to Rs 11,553 crores in FY 2022-23.
Speaking on the increased profits, Mohanty said, “We are well positioned to continue our growth journey, in the service of the nation and its citizens. The regulatory initiatives towards Insurance for All by 2047 will present opportunities to grow for the sector and we intend to participate in that growth. As we move forward to grow our business further, we will endeavour to create superior value for all our stakeholders. Finally, we thank all our policyholders, agents, employees and shareholders for maintaining their faith in us.”
The current price of LIC shares on BSE is Rs 607.75 per share.
The share price dropped after the Hindenburg report
It is pertinent to note that LIC’s price has seen ups and down since it was listed on May 20, 2022. The base price started at Rs 826.15 and plunged to its lowest at Rs 534.35 on March 31, 2023. It reached its lowest point before that in 2022 on October 21, 2022, at Rs 589.20. Since March 31 this year, the price has been rising persistently.
On January 24, 2023, Hindenburg Research, a short-selling company that pose as a whistleblower to gain profits, published a report against Adani Group alleging the company was manipulating its share prices. As LIC holds a substantial amount of shares of Adani Group in its portfolio, the Indian public sector insurer faced a direct impact. From Rs 712.80 per share, the price drastically dropped and kept touching lower points till March 31 this year.
On May 18, it was reported that there was a 35% drop in the market capitalisation of LIC. In May 2022, it was Rs 5.48 crore which dropped to Rs 3.59 crore in May 2023. Congress leader and disqualified MP Rahul Gandhi used the opportunity to gain some brownie points.
LIC का मार्केट कैपिटलाइजेशन
— Rahul Gandhi (@RahulGandhi) May 18, 2023
मई 2022: ₹5.48 लाख करोड़
मई 2023: ₹3.59 लाख करोड़
गिरावट: 35% ⬇️
साहेब का बस एक ही फोकस – सेठ को कैसे बचाएं! चाहे जनता की मेहनत की कमाई लुट जाए, या शेयर धारकों का निवेश डूब जाए!
Opposition, journalists and liberals attack Modi govt over alleged LIC losses
For Congress Party, Rahul Gandhi became the frontrunner to attack the Modi government over LIC market share and its holdings in Adani Group since the Hindenburg report came. Other opposition leaders, journalists and liberals joined the crusade.
In March 2023, Rahul Gandhi released an influencer-style video claiming that the investors were losing around Rs 1,000 crore every day as LIC had invested in Adani Group shares. He questioned who pressured LIC-SBI to invest in the Adani Group.
LIC को अडानी ग्रुप के शेयर्स के भाव गिरने के कारण अपने निवेश में हर दिन लगभग ₹1000 करोड़ का नुकसान हो रहा है।
— Rahul Gandhi (@RahulGandhi) March 1, 2023
देश पूछ रहा है – आखिर किसके दबाव में, LIC-SBI ने जनता की कमाई अडानी पर लुटाई?
Watch: https://t.co/lJS9tpTpKR pic.twitter.com/ND110tkETx
In the same month, Congress coined the term “Modani” to target the Modi government and claimed that the money from LIC, SBI and EPFO was transferred to the Adani Group.
LIC की पूंजी, अडानी को!
— Rahul Gandhi (@RahulGandhi) March 27, 2023
SBI की पूंजी, अडानी को!
EPFO की पूंजी भी, अडानी को!
‘मोडानी’ के खुलासे के बाद भी, जनता के रिटायरमेंट का पैसा अडानी की कंपनियों में निवेश क्यों किया जा रहा है?
प्रधानमंत्री जी, न जांच, न जवाब! आख़िर इतना डर क्यों?
In January 2023, Congress President Mallikarjun Kharge targeted the Modi government by stating LIC shares plunged after the Hindenburg report and the investors lost Rs 22,442 crores in two days. He said, “Modi Govt changes its name to LOOT INVESTMENT for CRONIES!”
After the Hindenburg exposé —
— Mallikarjun Kharge (@kharge) January 29, 2023
1️⃣ LIC shares have lost ₹22,442 Cr in just 2 days
2️⃣ LIC is plowing more money into Adani’s flagship unit
LIC is “Life Insurance Corporation” of India with 29 Cr Policyholders!
Modi Govt changes it’s name to
LOOT INVESTMENT for CRONIES!
Congress Secretary Randeep Surjewala said, “LIC is public money! Post Hindenburg Report, the value of LIC investment in Adani Group shares have fallen from ₹77,000 Crore to ₹53,000 crores — loss of ₹23,500 crores.”
In February 2023, AIMIM leader Asaduddin Owaisi said, “Poora kuppa kar diye” as we say in Hyderabad. LIC is putting the common man’s savings at risk; all for the sake of one man’s friendship. @PMOIndia’s motto seems to be “profit before people”.”
“Poora kuppa kar diye” as we say in Hyderabad. LIC is putting common man’s savings at risk; all for the sake of one man’s friendship. @PMOIndia’s motto seems to be “profit before people”. https://t.co/gcgf5kEUpI
— Asaduddin Owaisi (@asadowaisi) February 23, 2023
In a letter to PM, AAP leader Sanjay Singh claimed, “Adani’s mountain of lies and fraud is crumbling like a pack of cards. Crores of investors in the country are worried. Those who have invested in LIC, and SBI because both of them have given loans worth crores of rupees. The Prime Minister should come forward and address the issue.”
In April, AAP targeted the government by saying LIC lost Rs 60,000 crores by investing in Adani Group companies. Singh gave notice to Rajya Sabha for discussion claiming crores of investors were lost as LIC and SBI invested in Adani group.
AAP MP @SanjayAzadSln ने Adani Group द्वारा किए गए Fraud के मुद्दे पर संसद में दिया Notice‼️
— AAP (@AamAadmiParty) February 2, 2023
▪️नियम 267 के साथ-साथ शून्यकाल में इस मुद्दे को उठाने के लिए भी नोटिस दिया
▪️Adani के Fraud के चलते LIC, SBI सहित कई सरकारी संस्थाओं और देश की जनता के करोड़ों रुपए डूबे pic.twitter.com/ehoD5rYMVM
BRS leader Prof Dasoju Srravan said, “Just for the sake of one crony capitalist (#Adani), #Modi Govt is destroying #LIC affecting crores of its policyholders.. How come such a steep fall of market value from Rs 5.48 Lakh to Rs 3.59 Lakh Cr wiping away an amount of Rs 1.9 Lakh Cr within an year?” (sic)
Just for the sake of one crony capitalist (#Adani), #Modi Govt is destroying #LIC affecting crores of its policyholders..
— Prof Dasoju Srravan (@sravandasoju) May 17, 2023
How come such a steep fall of market value from Rs 5.48 Lakh to Rs 3.59 Lakh Cr wiping away an amount of Rs 1.9 Lakh Cr within an year? pic.twitter.com/oBiMymYYmV
Journalist Ravish Kumar questioned if LIC was safe and insinuated as if the investors’ money would be lost. Interestingly, LIC’s exposure in the Adani Group is 0.975 per cent at book value, as per The Hindu Businessline report from March 2023.
The Hindenburg report definitely affected the share price of LIC. However, its price was already fluctuating a lot since it was issued in May 2023. The company’s share is recovering since FY 2023-24 started. Since LIC release its Q4 report, the price has seen a jump of 2.06% by the time this report was published.
