Winning Bizness Desk
Mumbai. The country's largest insurance company 'Life Insurance Corporation of India' (LIC) has announced the results of the first quarter of this financial year (LIC Q1 Results). In the quarter of April to June, the net profit of the company (LIC net profit) has increased by 1299 percent and this figure has gone upto Rs 9543 crore. This increase in the company's profit has been attributed to higher return on investment. The company had reported a net profit of Rs 682 crore in the same period last year. Gross NPAs stood at 2.48 per cent as on June 30. It was 5.84 percent during the same period last year. The company's net NPA has remained zero as in the previous year. However, LIC's policy sales have declined.
Decline in premium income a matter of concern
Booming return on investment
Investment income of the country's largest insurer rose to Rs 90,309 crore in the April-June quarter from Rs 69,570 crore in the previous year. In the quarter, the insurer's first-year premium fell 8.3 percent to Rs. 6,810 crores. A year ago, this amount was Rs 7,429 crores. In a post-result press conference, LIC CEO and MD Siddharth Mohanty said the decline in premium income was a matter of concern.
How were the quarterly results?
LIC told the stock market that the company's total income for the June quarter was Rs. 1,88,749 crores. In the same quarter of the previous financial year, it was Rs 1,68,881 crores. In the June quarter, the insurance company posted Rs. 53,638 crore earnings. The company's transfer of funds to shareholders' accounts fell to Rs 1.48 crore from Rs 799 crore. Value of new business (VNB) in the June quarter was Rs 1300 crore as against Rs 1397 crore last year. Mohanty expressed his belief that VNB margin will increase in the future. A total of 32.16 lakh policies were sold in the individual segment during the June quarter. In the same quarter last year, 36.81 lakh policies were sold. This matter is said to be of concern. Resultantly, LIC shares fell 0.36 percent to settle at Rs 641.60 as the stock markets settled.
