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LIC share price falls 3% after weak Q4 results; now down 15% from IPO price; should you buy, sell, hold?

Life Insurance Corporation of India (LIC) share price fell 3 per cent to Rs 810 apiece on BSE on Tuesday, after the insurance company reported a loss of 18 per cent on-year in standalone net profit at Rs 2,371.55 crore for the three months to March 2022

LIC share price falls 3% after weak Q4 results; now down 15% from IPO price; should you buy, sell, hold?
This is the first-ever quarterly result of LIC after being listed on bourses earlier this month. Image: Reuters

Life Insurance Corporation of India (LIC) share price fell 3 per cent to Rs 810 apiece on BSE on Tuesday, after the insurance company reported a loss of 18 per cent on-year in standalone net profit at Rs 2,371.55 crore for the three months to March 2022. The board of LIC has recommended a dividend of Rs 1.50 per equity share with a face value of Rs 10 each for the year ended March 31, 2022. 

LIC stock has been witnessing continuous selling pressure since listing. “Investors having a long-term perspective, should continue to hold onto the stock, given the growth potential of the insurance sector in the country in the coming years and LIC in particular given its leadership position in the sector,” Aamar Deo Singh, Head Advisory, Angel One, told FinancialExpress.com.

This is the first-ever quarterly result of LIC after being listed on bourses earlier this month. Analysts say that despite a dip in Q4 net profit, LIC shares are quality stocks with strong fundamentals. “Its solvency ratio rose to 1.85 from 1.76 a year earlier. However, LIC’s 13-month persistency ratio fell this quarter. Inventors may wait for some more dip and initiate accumulating around 750 levels,” Ravi Singh, VP & Head of Research, Share India Securities, told FinancialExpress.com.

The stock has fallen more than 15 per cent from the issue price. “We may see more down-side movement in the price ahead of the negative secondary market sentiments. Investors who have the long position can maintain a stop loss of Rs 720. New investors can follow the buy dips strategy,” Akhilesh Jat, analyst, CapitalVia Global Research told FinancialExpress.com.

Earlier this month, the government raised Rs 20,557 crore by diluting its 3.5 per cent stake in the LIC through the IPO. LIC shares were listed at a discount of 8.62 per cent at Rs 867.20 apiece on BSE over the issue price of Rs 949 a share.

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