LIC share price rises today after 10 successive days of losses. Should you buy?
Premium- LIC share price today made an intraday high of ₹684 apiece on NSE, around 1 per cent up from its Monday's close price of ₹637.75 per share
LIC share price: After losing for ten successive sessions, shares of Life Insurance Corporation (LIC) of India were in green on Tuesday morning deals. LIC share price today opened with downside gap but soon recovered and went on to hit intraday high of ₹684 levels, logging more than 1 per cent rise from its yesterday's close price of ₹668.25 on NSE. After closing at ₹837.75 on NSE on 30th May 2022, LIC shares have been on a downward trend till Monday (13th June 2022).
According to stock market experts, one can accumulate LIC shares at current levels as the stock is available at an attractive valuations but the time horizon for accumulation has to be long term.
Speaking on LIC share price outlook, Santosh Meena, Head of Research at Swastika Investmart Ltd said, “We believe India's highly underserved life insurance market is still in its infancy and is well-positioned to capitalize on the enormous growth potential. LIC has several competitive advantages, including a strong brand value, a massive network of agents, and an enviable distribution network. Further, the company has plans to address concerns with the company like low VNB or value of new business margins, loss in market share, high reliance on agency channel, etc."
"Additionally, the company's issue was priced at a Price to Embedded Value of 1.1x, which was already at a discount compared to its global as well as Indian peers, and the current dip provides further valuation comfort. Another point we'd like to make is that investors should be aware that insurance is a long-term business; therefore wealth development and compounding occur only over time."
Sharing an interesting observation, Santosh Meena said that the low made on the first day of trade after the 30-day anchor investor’s lock-in period may act as strong support for a further rally for quality stocks.
Advising positional investors to accumulate LIC shares, Prasant Bhansaali, Director at Mehta Equities Ltd said, "At current price, LIC shares can be accumulated with at least 3 years perspective. It will remain under pressure for some more time as anchor investors will be free to exit after 16th June. But considering the relative cheap valuation at lower levels it will find interest from domestic retail and HNI investors. Institutional investor will wait for some more time before they start buying it."
Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint.