LIC Needs APE Shot for Stock

Shares of Life Insurance Corp. of India Ltd (LIC) hit a 52-week low on Tuesday, dropping to ₹790.20 apiece.

- Manish Joshi

The life insurer's Q3FY25 results were disappointing even though expectations were already low. LIC's total annualized premium equivalent (APE) and value of new business (VNB) declined 24% and 27% year-on-year (y-o-y) to ₹9,951 crore and ₹1,926 crore in Q3.

The only segment to report a meaningful jump in APE growth was unit-linked insurance plans (Ulips), where premium income from sales nearly tripled to ₹803 crore. In contrast, APE fell across all other categories except protection (term plans), which remains too small to make a significant impact.

LIC's shares slipped 2% since the results amid the already low valuation in terms of market capitalization to embedded value multiple at 0.62x. Other leading private life insurance companies enjoy a valuation multiple at least twice that.