Life Insurance Corporation of India, the IPO-bound life insurer, said its fiscal third quarter profit after tax jumped to Rs 234.91 crores
Life Insurance Corporation of India, the IPO-bound life insurer, said its fiscal third quarter profit after tax jumped to Rs 234.91 crores, from a mere Rs 0.91 crore in the same quarter in the previous year, primarily due to a change in funds redistribution policy. LIC’s profit for the first nine months of fiscal 2022, ie April-December, surged to Rs 1,642.78 crore, a jump from Rs 7.08 crore in the corresponding period previous year. The IPO of the largest insurer of the country has reportedly been approved by the markets regulator this week and an official announcement is imminent.
Read more:SEBI’s major drive against stock manipulators through social media channels
Ahead of the IPO, LIC changed its policy to redistribute its Life Fund amongst shareholders. The segregation of its Rs 35.93-lakh-crore ‘Life Fund’ into the participating and non-participating policyholders’ funds effective September 30, 2021 was announced in its DRHP. Under the changes, shareholders will now receive 5% of the surplus from the participating fund, and 100% of the surplus from the non-participating policyholders’ fund. Earlier, shareholders received 5% of the combined total fund. This has contributed to the jump in profits.
LIC reported total premiums earned of Rs 97, 761 crore, an increase of 0.8% from the same quarter previous year. The insurer earned a premium of Rs 97,008 crore in the third quarter of fiscal year 2021. Of the total premiums earned, renewal premium earned rose over 3% to Rs Rs 56,822 crore in comparison to last year. Renewal premium accounts for the largest chunk of total premiums, followed by single premium. Single premium fell 5% to Rs 32,190 crore in the quarter ended December 31, from Rs 34,063 crore in Q3 2021.
Read more:Ebixcash IPO: Company files draft paper with SEBI for Rs 6000 crore
The largest insurer is expected to formally announce that its IPO has been cleared by the market regulator SEBI. The IPO was approved on Wednesday this week according to media reports, which was approved in 23 days, the shortest time span taken by the regulator to approve an IPO. However, the IPO may be delayed to next year considering the market conditions due to the Russia-Ukraine crisis.
