Results for LIC Q2: Net profit more than doubles to Rs 15,952 crores
For the quarter that ended in September (Q2FY23), Life Insurance Corporation (LIC), the largest life insurance provider in India, detailed a net profit of Rs 15,952 crore, a major rise from Rs 1,433 crore during the same period in the other year.
The insurance had only revealed a net income of Rs. 682.9 crores for the June quarter. The first-year premium, a sign of company expansion, increased from Rs. 8198.30 crores to Rs. 9,124.7 crores for the quarter.
In comparison to the same time last year, net premium income increased to Rs 1.32 lakh crore from Rs 1.04 lakh crore. There were big rumors about the state-run company’s intentions to pay dividends or provide share capital to shareholders days before the quarterly results presentation. The reports on October 31 caused the LIC shares to increase by more than 2.5% in early trade.
On November 11, the stock’s closing price on the BSE was Rs 628, up almost 1.17 percent from the other day’s finish. Although the stock has increased recently, it has not reached the level it was when the company made its amazing initial public offering (IPO). LIC made its debut on the financial markets in May of this year, but since then, the shares have fallen by over 30%. Before the release of the outcome, LIC shares on the BSE completed 1.17% higher at 628.05. The insurer’s stock has lost more than 28% of its value from the $872 listing price since it went public in May after a record share sale of $2.7 billion.
The single premium increased 62% to 66,901 crores, while the renewal premium increased 2% to 56,156 crores. The gross non-performing asset (NPA) for LIC was $26,111 billion for the September quarter, compared to $26,619 billion for the before quarter and $28,929 billion for the other year. The net NPA ratio decreased from 5.84% in Q1 and 6.57% a year earlier to 5.60% at the conclusion of Q2.
The insurers’ 13th-month persistency ratio, which has a customer’s stickiness, increased to 70.52% in Q2 from 68.81% in Q2 of last year. The amount related to the buildup on the available balance models from non-participating insurance will be transferred to the holder’s profile in accordance with the new policy. Because of this, the net income for Q2FY23 increased.
According to LIC, the sum mentioned above is made up of Rs 5,580.71 crore (net of taxes) for the quarter that ended on September 30, 2022, Rs 4,148.77 crore (net of taxes) for the quarter that ended on June 6, 2022, & Rs 4,542.30 crore (net of taxes) for the quarter that ended on March 31, 2022.
Net investment income for the second quarter totaled Rs 84,103.64 crore, up from Rs 76,533.75 crore in the same quarter last year. Up from Rs. 117 crores during Q2 FY22, LIC has contributed Rs. 5,132.6 crores towards doubtful loans and bad loans waived off. The expected increased provision for employee pension payments during Q2 of FY2023, which was due to begin on August 1, 2022, was estimated at Rs 11,54,3.75 crore.
During Q2FY23, the life insurer paid out claims of Rs 84,269.04 crore which is against to Rs 85,451.59 crore given the same time the year before. First-year premium revenue for LIC increased 11.3 percent year over year during the quarter to Rs 9,125 crore. To reach Rs 66,901 crore, single premium spiked dramatically by 62 percent.
In the most recent September quarter, LIC’s overall revenue grew to Rs 22,29,488.5, worth rs 18,72,043.6 crores in the corresponding quarter last year. The solvency ratio, which compares an insurance company‘s financial performance to the amount it owes for total life cover, was the same at the end of the June quarter at 1.88% in the month of September 30.
Gross non-performing resources for the largest life insurer in the country on September 30 were Rs 26,111 crore, down from Rs 26,619 crore a quarter earlier and Rs 28,929 crore a year earlier.
At the conclusion of the second quarter, the gross Perceptual processing was 5.60%, down from 5.84% in Q1 and 6.57% a year earlier. As a part of a customer’s stickiness, the 13th-month longevity ratio for LIC was 70.52% in Q2 instead of 68.81% a year earlier. ][On the BSE, LIC stock completed 1.17 points which is more at Rs 628.05. Shares have lost more than 28% of their value since the deal price.
Edited by Prakriti Arora
