LIC Q2 Net Profit Rises 31% on Business Growth and Higher Margins
Life Insurance Corporation (LIC), one of India’s leading state-owned companies, has reported an impressive 31% year-on-year increase in consolidated net profit, reaching ₹10,098 crore for the September quarter. This performance was fueled by robust core business growth and improved margins, even amid a cautious equity market environment.
Key Highlights from LIC’s Performance:
– Profit Insights: In the previous year’s quarter, LIC recorded a profit of ₹7,728 crore.
– Premium Growth: The insurer faced challenges with premium growth, as individuals delayed purchases until the GST benefits were introduced on September 22.
– Investment Gains: As a major player in the Indian stock markets, LIC’s investment returns often bolster its bottom line.
– First Half Performance: LIC’s profit after tax for the first half of FY26 stood at ₹21,040 crore, a 16% increase from ₹18,082 crore in the previous year.
– Muting Premium Growth: Premium income grew modestly by 5.1% to ₹2,45,680 crore, influenced by temporary disruption in business volumes due to GST exemptions.
– VNB Growth: The value of new business (VNB) saw a growth of 12.3% to ₹5,111 crore, with improved VNB margins increasing by 140 basis points to 17.6%.
R Doraiswamy, MD and CEO, emphasized the strategic shift towards more profitable products, increasing the share of non-participating policies. Looking ahead, LIC anticipates a robust second half of the fiscal year, showcasing early positive momentum.
Conclusion
LIC remains committed to prioritizing profitability and margins while passing on GST benefits to customers without affecting agent commissions. With a current embedded value of ₹8,13,230 crore, slightly down from ₹8,21,716 crore last year, LIC is poised for sustained growth and profitability. The company’s focus on embracing profitable strategies and responding positively to market shifts positions it well for future success.