LIC Q2 net slides 4% to ₹7,621 cr on an 11% rise in premium income to ₹1.20 lakh crore 

The Life Insurance Corporation of India (LIC) reported standalone net profit declined nearly 4% in the September quarter to ₹7,620.86 crore, from ₹7,925.02 crore a year earlier, even as net premium income increased more than 11% to ₹1,19,900.99 crore (₹1,07,396.77 crore).

Income from investments was 16% higher at Rs.1,08,972.43 crore (Rs.93,942.20 crore).

Net rose 3.5% in H1

For the six months ended September, standalone net profit increased more than 3.5% to ₹18,082 crore (₹17,469 crore). Total premium income was 13.56% higher at ₹2,33,671 crore (₹2,05,760 crore), LIC said in a release.

“Second quarter was also good, because of provisioning it is showing some depletion,” CEO and MD Siddhartha Mohanty said to a media query on lower net profit. A senior official attributed the “marginal decline” to the ₹1,057.94 crore fund transfer to policyholders’ account. In the year earlier period, it was ₹33 lakh and for the quarter ended June ₹1,268.07 crore.

Market share up

During the first half, LIC delivered holistic growth on various business parameters such as market share, premium, non par share within individual business, value of new business, VNB margin and embedded value.

“Our market share for H1FY25 increased to 61.07% as compared to 58.50% for the same period previous year. We have been consolidating our gains in terms of changing our product mix. Our margin trajectory is on the upswing… VNB margin is 16.2% as against 14.6%. Our strategy on enhancing market share alongwith changes in product and channel mix, without compromising on profitability, is yielding very visible results. Further we have aligned our products with the new regulatory guidelines by redesigning them in such a manner that the interest of customers, shareholders and various marketing channel partners are taken care of,” Mr.Mohanty said.

To a query on LIC’s proposed foray into health insurance by acquiring stake in a standalone health insurer, he said the groundwork is underway and since the process involves lot of formalities, including some time consuming as well as approvals from regulatory authorities, is expected to get over by this fiscal.

In its release on the results, LIC said the VNB for six months upto September was ₹4,551 crore (₹3,304 crore, an increase of 37.74%. LIC sold 91,70,420 policies in the individual segment during the first six months compared to 80,60,725 policies in the year earlier period, an increase of 13.77%.

The Indian Embedded Value (IEV) as on September 30 has been determined as ₹8,21,716 crore, which is 24.01% more from ₹6,62,605 crore a year earlier. The Solvency Ratio increased to 1.98 as against 1.90. The yield on investments on policyholders funds, excluding unrealised gains, was 9.02% as against 9.06% in the corresponding six months of previous fiscal.

LIC shares closed 1.62% lower at ₹914.75 apiece on the BSE.