May 29, 2024
New Delhi, India
LIC Q4 Financial Results: Marginal Profit Increase and Improved Asset Quality
Life Insurance Corporation of India (LIC), the country’s largest insurer, reported a marginal 2.5% year-on-year (YoY) rise in net profit for the fourth quarter of FY24. The net profit increased to ₹13,762 crore, up from ₹13,421 crore in the same quarter of the previous year. The results were accompanied by an announcement of a ₹6 interim dividend per share.
Key Financial Highlights
Net Profit:
- LIC’s net profit for Q4 FY24 stood at ₹13,762 crore, reflecting a 2.5% YoY increase.
Asset Quality:
- The gross non-performing asset (GNPA) ratio improved to 2.01% from 2.56% in the year-ago period, indicating better asset quality.
Value of New Business (VNB):
- The VNB increased by 4.66% to ₹9,583 crore.
- The VNB margin improved by 60 basis points (bps) to 16.8%.
Non-Par Annualized Premium Equivalent (APE):
- The non-par APE share within the individual business grew by 9.43% to 18.32%.
- The non-par APE surged from ₹3,436 crore in FY23 to ₹7,041 crore in FY24, registering a 105% growth.
- The non-par share of individual business on an APE basis increased from 8.89% in FY23 to 18% in FY24.
Policy Sales:
- LIC sold 2.03 crore policies in the individual segments, slightly down from 2.04 crore policies sold in FY23.
Assets Under Management (AUM):
- AUM increased by 16.48% YoY to ₹51.21 lakh crore as of March 2024, up from ₹43.97 lakh crore as of March 31, 2023.
Solvency Ratio:
- The solvency ratio improved to 1.98% from 1.87% in the previous year.
Dividend Announcement
LIC announced an interim dividend of ₹6 per share for its shareholders, reflecting the company’s solid performance and commitment to returning value to investors.
Market Reaction
Following the announcement of the Q4 results, LIC’s stock closed at ₹1,035.80, up 0.58% from the previous day’s close. The marginal profit increase and strong asset quality contributed to the positive market reaction.
Conclusion
LIC’s Q4 results showcase a steady increase in net profit and significant improvements in asset quality. The announcement of a ₹6 interim dividend further underscores the insurer’s robust financial health and commitment to its shareholders. The growth in AUM and solvency ratio highlights LIC’s strong position in the insurance market.
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