LIC shares likely to rise 22% post Q1 earnings, check new target price
LIC stock gained 3.56 per cent to Rs 706.50 against the previous close of Rs 682.15 on BSE today. Motilal Oswal has assigned a target price of Rs 830, a 22 per cent upside to Friday's close of Rs 682.
- Aug 16, 2022,
- Updated Sep 27, 2022 10:54 AM IST
Shares of Life Insurance Corporation (LIC) of India gained over 3 per cent in early trade today after the insurer reported a multifold rise in standalone net profit for the quarter ended June 30,2022. Considering the stellar Q1 earnings, financial services firm Motilal Oswal has assigned a target price of Rs 830, a 22 per cent upside to Friday's close of Rs 682.
Meanwhile, LIC stock gained 3.56 per cent intraday to Rs 706.50 against the previous close of Rs 682.15 on BSE. Shares of LIC opened higher at Rs 693.90. Market cap of LIC rose to Rs 4.44 lakh crore on BSE. Total 1.55 lakh crore shares of the firm changed hands amounting to a turnover of Rs 10.88 crore.
The stock fell to an intraday low of Rs 662.75 on BSE.
Net profit climbed to Rs 682.88 crore for the quarter ended June 30 against a standalone profit of Rs 2.94 crore in the corresponding quarter of the last fiscal.
LIC Q1 Results: Net profit climbs 232 times to Rs 683 crore, net premium income jumps over 20%
The net premium income of LIC rose 20.35 per cent YoY to Rs 98,351.76 crore.
The insurance behemoth reported other income of Rs 160.09 crore in Q1FY23 against Rs 145.47 crore in Q1FY22. Transfer of funds from shareholders' accounts stood at Rs 799.24 crore during the quarter under review.
MR Kumar, Chairperson, LIC said, "As the Covid situation normalises, we are seeing a larger activity on the ground, therefore bringing us back closer to our model of having "feet on street" and continuous in person engagement with our customers. While the growth numbers are very robust for the first quarter as seen in comparison to the same quarter of FY2021-22, we are aware that the Q1 of the previous year, FY2021-22 was impacted by a very tough second wave of Covid. However, the trajectory is upwards and we are looking at increased business volumes as is evident in our market share in the year to date since January 2022."
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The assets under management rose to Rs 41.02 lakh crore as on June 30, 2022 against Rs 38.13 lakh crore in the corresponding quarter last year, clocking an increase of 7.57 per cent.
Motilal Oswal in an earnings review said, "We revise our FY23/FY24 value of new business (VNB) margin by 200bps/100bps to 14.2 per cent/14.6 per cent, and raise our VNB estimate by 24 per cent /18 per cent. We expect LIC to deliver a 13 per cent CAGR in APE over FY22-24, thus enabling 14% VNB CAGR. However, we expect operating RoEV to remain modest at 12.4 per cent, given its lower margin profile than private peers. We maintain our Buy rating."
Manoj Dalmia, founder and director, Proficient Equities said, "LIC reported a multifold jump in its June quarter net profit at Rs 682.9 crore as compared to Rs 2.9 crore in the year-ago period. LIC reported a 20% year-on-year (YoY) growth in net premium. The stock is seeing some turnaround in price action. We can expect a target of Rs 782 in the coming days, investors with long term view can accumulate. "
Rohit Khatri, Assistant Vice President of Research, Religare Broking said, "LIC has delivered strong earnings in this quarter with net premium income of 20% YoY led by 35% growth in new business premium. Moreover, improving market share was also a key positive for the company. We remain constructive on LIC given its leadership position coupled with sharp focus on improving its non par business which would aid better profitability for the company."
Shares of Life Insurance Corporation (LIC) of India gained over 3 per cent in early trade today after the insurer reported a multifold rise in standalone net profit for the quarter ended June 30,2022. Considering the stellar Q1 earnings, financial services firm Motilal Oswal has assigned a target price of Rs 830, a 22 per cent upside to Friday's close of Rs 682.
Meanwhile, LIC stock gained 3.56 per cent intraday to Rs 706.50 against the previous close of Rs 682.15 on BSE. Shares of LIC opened higher at Rs 693.90. Market cap of LIC rose to Rs 4.44 lakh crore on BSE. Total 1.55 lakh crore shares of the firm changed hands amounting to a turnover of Rs 10.88 crore.
The stock fell to an intraday low of Rs 662.75 on BSE.
Net profit climbed to Rs 682.88 crore for the quarter ended June 30 against a standalone profit of Rs 2.94 crore in the corresponding quarter of the last fiscal.
LIC Q1 Results: Net profit climbs 232 times to Rs 683 crore, net premium income jumps over 20%
The net premium income of LIC rose 20.35 per cent YoY to Rs 98,351.76 crore.
The insurance behemoth reported other income of Rs 160.09 crore in Q1FY23 against Rs 145.47 crore in Q1FY22. Transfer of funds from shareholders' accounts stood at Rs 799.24 crore during the quarter under review.
MR Kumar, Chairperson, LIC said, "As the Covid situation normalises, we are seeing a larger activity on the ground, therefore bringing us back closer to our model of having "feet on street" and continuous in person engagement with our customers. While the growth numbers are very robust for the first quarter as seen in comparison to the same quarter of FY2021-22, we are aware that the Q1 of the previous year, FY2021-22 was impacted by a very tough second wave of Covid. However, the trajectory is upwards and we are looking at increased business volumes as is evident in our market share in the year to date since January 2022."
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The assets under management rose to Rs 41.02 lakh crore as on June 30, 2022 against Rs 38.13 lakh crore in the corresponding quarter last year, clocking an increase of 7.57 per cent.
Motilal Oswal in an earnings review said, "We revise our FY23/FY24 value of new business (VNB) margin by 200bps/100bps to 14.2 per cent/14.6 per cent, and raise our VNB estimate by 24 per cent /18 per cent. We expect LIC to deliver a 13 per cent CAGR in APE over FY22-24, thus enabling 14% VNB CAGR. However, we expect operating RoEV to remain modest at 12.4 per cent, given its lower margin profile than private peers. We maintain our Buy rating."
Manoj Dalmia, founder and director, Proficient Equities said, "LIC reported a multifold jump in its June quarter net profit at Rs 682.9 crore as compared to Rs 2.9 crore in the year-ago period. LIC reported a 20% year-on-year (YoY) growth in net premium. The stock is seeing some turnaround in price action. We can expect a target of Rs 782 in the coming days, investors with long term view can accumulate. "
Rohit Khatri, Assistant Vice President of Research, Religare Broking said, "LIC has delivered strong earnings in this quarter with net premium income of 20% YoY led by 35% growth in new business premium. Moreover, improving market share was also a key positive for the company. We remain constructive on LIC given its leadership position coupled with sharp focus on improving its non par business which would aid better profitability for the company."