Analysts have trimmed their price target on Life Insurance Corporation of India from about ₹1,110 to roughly ₹1,080, reflecting updated assumptions that combine higher revenue growth expectations with slightly lower profit margins and a modestly reduced forward P/E.
What's in the News
- The government is considering a further public offering of LIC shares in the next financial year, with Financial Services Secretary M Nagaraju stating that LIC stake dilution will be handled gradually and in coordination with DIPAM (Financial Services Secretary briefing).
- The government currently holds a 96.5% stake in LIC after selling 3.5% through the May 2022 IPO at a price band of ₹902 to ₹949 per share, which raised about ₹210,000 million (Key Developments).
- The government is required to reduce its holding by another 6.5% to meet the mandated 10% public shareholding requirement by May 2027, with the quantum, price and exact timing of any further sale yet to be decided (Key Developments).
- Officials have indicated that a follow on public offer, or FPO, of LIC may take place in the next financial year if approvals are in place and market conditions are considered conducive (Financial Services Secretary briefing).
- LIC has scheduled a board meeting on February 5, 2026, to consider and approve its unaudited standalone and consolidated financial results for the quarter and nine months ended December 31, 2025 (Board Meeting filing).
Valuation Changes
- Fair Value: revised slightly lower from about ₹1,110.10 to roughly ₹1,080.39 per share, indicating a modest reset in the intrinsic value estimate.
- Discount Rate: reduced slightly from 12.73% to 12.48%, reflecting a small change in the required rate of return used in the valuation model.
- Revenue Growth: assumption raised from about 4.83% to roughly 9.33%, implying a higher projected pace for ₹ revenue expansion in future periods.
- Net Profit Margin: assumption lowered from about 5.95% to roughly 4.87%, indicating a more conservative view on future ₹ earnings relative to revenue.
- Future P/E: trimmed slightly from about 23.39x to roughly 22.94x, suggesting a small reduction in the valuation multiple applied to projected earnings.
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