Will the LIC share price increase?


Editorial team Published on

Whether the Life Insurance Corporation of India (LIC) share price will increase depends on a mix of strong operational improvements and near-term market pressures.

Current Market Status

  • Price: Around ₹387.65 – ₹391.85 per share
  • Valuation: P/E ratio is roughly 8.25x, which trades at a discount compared to the broader insurance industry average (~13.5x to 14.2x).
  • Performance: The stock has faced pressure partly due to ongoing government stake sales (Offer for Sale / OFS) to meet SEBI's 10% public shareholding requirement (target deadline May 2027), though it trades significantly below its May 2022 IPO price of ₹949.

Bullish Factors (Reasons for Potential Increase)

  • Improving Margins & Product Mix: LIC has grown its Value of New Business (VNB) and expanded VNB margins (reaching ~22.9%) by shifting more toward profitable non-participating policies.
  • Profitability Growth: Strong profit-after-tax (PAT) numbers and a solid dividend yield (~2.55%–2.58%) provide income support for long-term investors.
  • Analyst Ratings: Major brokerages remain largely optimistic. For instance, Motilal Oswal maintains a Buy rating with a target up to ₹480, and HDFC Securities has an Add rating with a target around ₹555.

Bearish Factors & Risks (Reasons for Restraint)

  • Supply Pressure from Stake Sales: Future government OFS actions can create short-term technical supply pressure on the stock.
  • Competition & Market Share: Increased competition from private-sector life insurers continues to challenge premium growth dynamics.