LIC shares extend gains for 4th day to top Rs 600 mark; time to book profit or more upside possible?

Shares of Life Insurance Corporation of India on Thursday extended their gains for the fourth consecutive session. The stock climbed 1.69 per cent to settle at Rs 603.60 over its previous close of Rs 593.55. At today's closing level, the scrip has recovered 13.84 per cent from its 52-week low of Rs 530.20, a level seen on March 29, 2023. That said, it has declined 28.23 per cent from its one-year high of Rs 841.

The state-run insurer, in an exchange filing, said it has increased its holding in two select stocks, Tata Power and Bata India. In Tata Power, LIC upped its holding to 25,35,37,551 shares or 7.94 per cent (till May 24, 2023) of the paid-up capital from 24,01,67,154 shares or 7.52 per cent stake in the March 2023 quarter.

LIC also said its shareholding in Bata India increased to 83,95,740 shares or 6.53 per cent (till May 24 this year) from 64,36,692 shares or 5.01 per cent as on March 31, 2023.

Further, the insurance behemoth posted a more than five-fold jump (447.57 per cent) in consolidated net profit to Rs 13,191 crore for the fourth quarter that ended March 2023. LIC had earned a profit of Rs 2,409 crore in the same quarter a year ago.

However, the total income of the insurer during the March quarter slipped 6.71 per cent to Rs 2,01,022 crore from Rs 2,15,487 crore in the same period of the previous year.

On the technical setup, analysts suggested that the counter may witness a pullback in the coming days.

"LIC is very overbought on the daily charts with strong resistance at Rs 625. Investors should book profits at current levels as a fall till support of Rs 567 looks likely in the coming days," said AR Ramachandran from Tips2trades.

"LIC traded below its 200-day Exponential Moving Average (EMA), which is around Rs 627. A pullback is expected and the stock may get support at Rs 570-582 levels. So, one should wait for these lower levels to build further fresh positions with a mid-term to long-term view for targets between Rs 650 and Rs 750. Keep strict stop loss placed at Rs 527," said VLA Ambala, Research Analyst at Stock Market Today.

Meanwhile, Indian equity benchmarks settled on a higher note today in a highly volatile trade, led by gains in consumer, metal, automobile and technology stocks.