LIC ups stake in Hero MotoCorp, CAPRI, HUL

State-owned insurance behemoth Life Insurance Corporation (LIC) of India has increased its shareholding in three companies -- Hero MotoCorp Ltd., CAPRI Global Capital Ltd., and Hindustan Unilever Ltd.

In a statement to the stock exchanges, the insurance company says its shareholding in Hero MotoCorp has increased from 9.163% to 11.256% i.e. from 1,83,10,233 to 2,24,91,571 equity shares, of the paid-up capital of the two-wheeler company. "Holding increased from 9.163% to 11.256% during the period from 04.01.2021 to 13.06.2022 at an average cost of INR 3050.14," says LIC.

LIC's shareholding in CAPRI increased from 88,58,348 to 1,24,00,000 equity shares, raising its shareholding from 5.043% to 7.059% of CAPRI's paid-up capital.

With a market cap of ₹12,214 crore, CAPRI caters to the non-banking finance industry. It has a presence across different segments like MSME, construction finance, affordable housing and indirect retail lending. LIC's holding in CAPRI increased from 5.043% to 7.059% during the period from February 21, 2022, to June 10, 2022, at an average cost of ₹624.61, LIC tells the exchanges.

LIC also increased its shareholding in HUL from 11,73,80,500 to 11,76,90,500 equity shares aggregating to 5.008% of the paid-up capital of the said company. HUL is one of the biggest FMCG companies in India, with a market capitalisation of ₹5.13 lakh crore. It caters to the home care, beauty and personal care and food & refreshment segments. "Holding increased from 4.995% to 5.008% as on 13.06.2022 at an average cost of INR 2206.93," LIC adds.

The Corporation also announced the launch of its new product on June 14. The new product, LIC's Dhan Sanchay, is a non-linked, non-participating, individual savings, and life insurance plan, which will cater to the domestic market.

Besides, the LIC stock has today surged 3.27% or 22.05 points to ₹696.75. It has shown some resistance for the past two days after witnessing a continuous fall for 10 days before that, amid weak market sentiments globally. The stock, which was listed on the bourses about a month back on May 17, 2022, has shed 20.33% of its value from its initial public offering (IPO) price of ₹949.

The 10-session correction eroded investors’ wealth by ₹1.7 lakh crore as market capitalisation dropped to ₹4.38 lakh crore as compared to the valuation of around ₹6 lakh crore during the market debut on May 17. Meanwhile, the BSE benchmark Sensex and Nifty 50 both are in positive territory today, with the former up 0.15% to 52,771.15 and the latter rising 0.14% to 15,753.95 points.

Traders fear the LIC stock may see further correction as anchor investors might sell their shares in the insurance major as the lock-in period on all its allotted shares has ended on Monday i.e. June 13. The state-owned insurer had raised around ₹5,627 crore from anchor investors ahead of its mega initial public offering (IPO), with more than 70% coming from domestic mutual funds.

The LIC IPO had received a tremendous response from investors, with the issue oversubscribing 2.95 times. The issue raised a ₹43,933 crore demand against the intended offer size of ₹21,000 crore. However, the stock listing coincided with the global sell-off that led to a sharp fall in the stock price. At the time of listing, LIC was the 5th biggest listed firm in terms of market capitalisation but due to its dismal performance, its ranking has slipped to the seventh position.