India's largest insurer, LIC ( Life Insurance Corporation of India ), is back in the spotlight, and this time, for all the right reasons.
On Wednesday (May 28, 2025), LIC's shares surged nearly 7 per cent. The cheer was driven by a sharp 38 per cent jump in net profit for the quarter ended March 2025, hitting Rs 19,013 crore.
Q4 FY25 results snapshot
| Metric | Q4 FY25 | Q4 FY24 | YoY change |
|---|---|---|---|
| Net profit | Rs 19,013 crore | Rs 13,190 crore | 44.1 per cent |
| Net premium income | Rs 1.48 lakh crore | Rs 1.53 lakh crore | - 3.2 per cent |
| Solvency ratio | 2.11 | 1.98 | 13 bps |
| Value of new business (VNB) | Rs 2,200 crore | Rs 1,940 crore | 13.4 per cent |
| Dividend per share | Rs 12 | Rs 6 | 100 per cent |
The earnings beat primarily resulted from reduced costs, especially employee-related expenses. But the drop in premium income? That's because new IRDAI rules changed the way policy surrenders are accounted for.
Fewer surrenders = less top-line premium.
About the company
LIC was launched in 1956. It's the behemoth that dominates India's life insurance space, owning more than two-thirds of the market share in terms of new business premiums.
Below is a summary of the company's fundamentals.
| Metric | Value |
|---|---|
| Market cap | Rs 5.72 lakh crore |
| ROE | 63.1 per cent |
| ROCE | 63.3 per cent |
| P/E ratio | 11.8 |
| P/B ratio | 4.5 |
| Dividend yield | 1.1 per cent |
| Book value | Rs 170.9 |
| EPS | Rs 76.4 |
The takeaway
LIC's Q4 numbers are encouraging, and the dividend shows the insurer is willing to reward shareholders. But don't ignore the slip in premium collections. This is still a state-run giant adjusting to new regulations and a shifting insurance landscape.
The recent stock rally may have narrowed some of the valuation gap, but long-term investors seeking stability and decent dividend yields may still find value here.
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Disclaimer: This is not a stock recommendation. This story was created with the assistance of artificial intelligence and is intended for informational purposes only. Please take it with a pinch of salt and do your own research or consult a financial advisor before making investment decisions.
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