LIC Skids 15 Per Cent Since Listing, Market Cap Drops Below Rs 5 Lakh Crore

For the fifth straight day, the LIC stock was trading down, sliding 6 per cent during the period

Life Insurance Corporation of India’s (LIC’s) shares have declined about 15 per cent since its listing on the bourses on May 17. On Monday, the shares dropped 2 per cent to Rs 786.05, on the BSE.

Since listing, LIC shares hit their lowest level, with the market capitalistion of the life insurer breached below the Rs 5-lakh crore-mark, the BSE data said.

For the fifth straight day, the LIC stock was trading down, sliding 6 per cent during the period.

The state-run insurer had made a weak market debut on May 17 as it listed at 8 per cent below its issue price. With Monday’s decline, LIC has slumped 17 per cent below its issue price of Rs 949 per share in a week.

The LIC IPO, which was to date India’s biggest ever IPO of Rs 20,557-crore, was subscribed just 2.95 times. Retail investors got the allotment at Rs 905 per share, LIC’s policyholders were allotted shares at Rs 889 per share.

In a note, brokerage firm Emkay Global Financial Services last week began coverage on LIC with a ‘hold’ rating and a target price of Rs 875, up around 11 per cent from current levels, according to news reports.

Though analysts remain optimistic of the state-insurer's market leadership and comfortable valuations, they prefer private sector peers with better growth and profitability outlook, thereby, generating higher RoEV.

At 12.45 pm on Monday, the shares of LIC were trading at Rs 784.60, down 1.96 per cent on the BSE.