LIC Embedded Value: The insurance giant, Life Insurance Corporation (LIC) of India, said the embedded value determination exercise has commenced from March 2022 and is likely to be completed by July 15. It said the exercise to determine India’s Embedded Value (IEV) as of March 31, 2022, could take a little longer to complete.
In its update on today’s exchanges, LIC said: “It has been informed that the determination of the Indian Embedded Value (IEV) as of March 31, 2022 may take a little longer to complete.”
“Once completed and following the required approvals, the required public disclosures will be made in this regard,” added LIC.
The Embedded Value (EV) is a measure of the consolidated value of the shareholder’s interest in the life insurance business. It represents the value of the shareholder’s interest in the profit that can be distributed from the assets allocated to the company, after due consideration of the overall risks in the company.
The embedded value of LIC was set at approximately Rs 5.4 lakh crore by the international actuarial firm Milliman Advisors on September 30, 2021.
Since its listing in May this year, investors and analysts have been eager to get more up-to-date data on embedded value. LIC had previously said it would regularly disclose its embedded value. Typically, insurance companies disclose it twice a year.
LIC share: correction in share price
The sharp correction in LIC (Life Insurance Corporation of India) stock prices after its discounted listing on May 17 has dealt a major blow to investors as the state-run insurer’s market capitalization has plummeted.
While this sharp drop is a major disappointment, stock market analysts say investors should be patient as the stock could make a comeback.
VK Vijayakumar, chief investment strategist at Geojit Financial Services, said the performance of LIC shares after the IPO was a major disappointment. However, he says it is still too early to conclude that the share price will not reach the stock price in the coming year. If LIC’s Q1FY23 results are good, the stock could make a comeback, but it will likely underperform if there is a rally in the market.”
LIC reported a net profit of Rs 2,409 crore for the quarter ended March 2022, which was 17.41 percent lower compared to Rs 2,917.33 crore reported in the same period a year ago. The company’s net profit for the entire fiscal year was reported as Rs 4,043.12 crore, which was 39.4 percent higher compared to Rs 2,900.56 crore in FY21.
Total revenue in Q4 FY22 was Rs 2,11,471 crore, which was 11.64 percent higher compared to Rs 1,89,176 crore revenue reported in the corresponding quarter last year.
Shares of the life insurer traded 0.51 percent lower at Rs 675.9 each at 10:55 AM.
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