LIC Shares Rise 9% As Q4 PAT Jumps 38% YoY, Dividend Announced; Should You Invest?

Last Updated:May 28, 2025, 12:59 IST

Shares of Life Insurance Corporation of India (LIC) rallied 9 per cent to Rs 948 on May 28 following the release of its Q4FY25 earnings

LIC Share Price: Shares of Life Insurance Corporation of India (LIC) rallied 9 per cent to Rs 948 on May 28 following the release of its Q4FY25 earnings. While the results were mixed, most brokerages retained a positive outlook, citing attractive valuations and improved profitability as near-term catalysts.

Motilal Oswal reiterated its “Buy” rating with a revised target price of Rs 1,050. The brokerage highlighted a rising share of non-participating (non-par) policies, which supported an expansion in LIC’s Value of New Business (VNB) margin during the quarter. Additionally, management commentary hinted at a recovery in premium growth going forward.

Macquarie also maintained an “Outperform” rating, with a more aggressive target of Rs 1,215. While acknowledging concerns around VNB growth, Macquarie said the stock’s low valuation offers downside protection. The brokerage expects an improved product mix and enhanced cost efficiencies to support continued margin growth.

However, Goldman Sachs took a more cautious stance, maintaining a “Neutral” rating and a lower target of Rs 880. The firm flagged weaker revenue from individual participating and group insurance segments, which fell 16 per cent year-on-year. The agency channel also faced headwinds due to the launch of new products on October 1.

In terms of financial performance, LIC’s Q4 net profit rose 38 per cent YoY to Rs 19,013 crore. However, net premium income declined 3 per cent YoY to Rs 1.4 lakh crore. On a positive note, gross non-performing assets (NPAs) improved significantly, dropping 55 basis points sequentially to 1.46 per cent.

The company attributed its muted Annualized Premium Equivalent (APE) growth in FY25 to regulatory changes, which required product redesigns and agent re-training. “Many products had to be refiled, impacting sales momentum. A higher proportion of single-premium policies also weighed on APE,” LIC management told CNBC-TV18.

Looking ahead to FY26, LIC aims to achieve double-digit growth in weighted risk premiums and APE. The management expects VNB margins to improve by 2–3 percentage points, reaching close to 20 per cent for the full year.

LIC Q4 Dividend Announcement and Record Date

Alongside its earnings, LIC declared a final dividend of Rs 12 per share for the financial year ending March 31, 2025. The dividend is subject to shareholder approval at the upcoming Annual General Meeting (AGM). LIC has fixed July 19, 2025, as the record date. Shareholders on record as of this date will be eligible to receive the payout. The dividend reflects LIC’s continued focus on rewarding shareholders amid stable profitability.

LIC Share Price History

Since its stock market debut in May 2022, LIC has seen significant price swings. After listing at a discount to its issue price of Rs 949, the stock declined sharply, hitting a low of around Rs 530 in March 2023. However, strong earnings recovery and renewed investor interest have fueled a robust rebound. Between late 2023 and mid-2025, LIC shares have climbed steadily. As of May 28, 2025, the stock has gained nearly 60% year-to-date, substantially outperforming broader market indices.

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