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LIC share price at new record low, falls for 8th straight day, dives 22% from IPO price; buy, sell, hold?

LIC (Life Insurance Corporation of India) share price fell for the 8th consecutive session on Wednesday, hitting a fresh all-time low of Rs 738.10 apiece on BSE

LIC, LIC share price
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LIC (Life Insurance Corporation of India) share price fell for the 8th consecutive session on Wednesday, hitting a fresh all-time low of Rs 738.10 apiece on BSE. With today’s nearly 2 per cent fall, the market cap of the insurance company stood at Rs 4.68 lakh crore. However, at the offer price of Rs 949, LIC’s market capitalisation was at Rs 6.02 trillion. LIC stock price is down 22 per cent from its IPO price of Rs 949 during its public offer. Currently, the insurer is the seventh most valued firm in terms of market capitalisation, followed by State Bank of India (SBI) with a market capitalisation of Rs 4.13 lakh crore. 

Analysts say that LIC stock has been under natural price discovery process; it is down over 20 per cent from its IPO price and have not shown any signs of finding a bottom for itself. “Given the relentless decline since listing, the stock has gotten too deeply oversold and may be in for some technical pullback in near future. Investors can consider accumulating the stock at current levels by exposing a small portion of their capital. Not all should be purchased at once but the stock can be now bought in small quantities keeping room for some more decline during this natural price discovery process,” Milan Vaishnav, CMT, MSTA, Consulting Technical Analyst and founder, Gemstone Equity Research & Advisory Services, told FinancialExpress.com.

LIC shares continue to witness selling on the back of inflationary concerns and liquidity tightening fears, Aamar Deo Singh, Head Advisory, Angel One, told FinancialExpress.com. Singh suggested investors holding the stock from a long-term perspective, ideally should not be swayed by the daily price movements. He said that technically, for the stock to witness a change in the trend, the stock must trade above the 840 mark consistently.

Ravi Singh, VP & Head of Research, Share India Securities said that LIC share price is witnessing heavy selling pressure due to fresh shorts and long coverings. He told FinancialExpress.com that due to overall weakness in the market amid higher inflation and rising interest rates, the selling in the stock may continue further and can touch the levels of 700 in coming trading sessions. Ravi Singh advised investors to to exit the stock at current levels, however, high risk appetite investors may hold their positions and wait for the trend reversal.

Last week, domestic brokerage firm Emkay Global Financial Services initiated coverage on LIC stock with a hold rating, and target price pegged at Rs 875 apiece. While Macquarie analysts had initiated coverage of LIC stock with a ‘Neutral’ tag. However, despite the neutral tag, the international brokerage and research firm pinned a target price of Rs 1,000 per share on the stock.

The stock recommendations in this story are by the respective research analysts and brokerage firms. Financial Express Online does not bear any responsibility for their investment advice. Capital markets investments are subject to rules and regulations. Please consult your investment advisor before investing.

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