Winning Bizness Desk
Mumbai. The shares of Life Insurance Corporation of India (LIC) is declining everyday. LIC's stock fell 3.13 percent on NSE and closed at Rs 753 while making a low of 751.80 on Tuesday. Similarly, the closing on BSE took place at Rs 752.90, while the low remained at Rs 751. This stock has been nothing short of a nightmare for investors. It has started in the same way as Paytm was started. Paytm had also dumped a lot of investors' money and LIC's move so far has been negative. Comparison of both is because both have been the biggest IPOs till date. Both have raised a lot of money from the market. But investors would not have expected such a thing from LIC's stock.
21 percent drop in 21 days
If we talk about the fall from its issue price (Rs 949) till now, then this stock has come down by almost 21 percent. LIC's stock, which was listed on 17 May 2022, has completed 21 days today. There has been 16 trading sessions in 21 days and it has made a low of Rs 751. During this, investors have lost more than 1 lakh 23 thousand crore rupees. On Tuesday, LIC's market capitalization came down to 4.79 lakh crore, which is about Rs 1.23 lakh crore less than its issue price of Rs 949. The market capitalization of LIC at the issue price of Rs 949 was around Rs 6 lakh crore.
Share was oversubscribed 3 times
LIC had brought the country's biggest IPO and it was subscribed almost 3 times. On the very first day it got listed below its issue price and then never let go of the issue price, it could not even go above its listing price. It is believed that LIC's stock is also under pressure due to the volatility present in the market. Given the rising inflation from above and the possibility of a hike in the repo rate by RBI on June 8, investors are currently cautious in investing in the stock market.
The result of weak results?
LIC had released the March quarter results last week. The company said that its consolidated net profit declined by 17 percent to Rs 2,410 crore in the March 2022 quarter. However, during this period LIC's net premium increased and it increased by 17.9 percent to Rs 1.4 lakh crore. Some people are also considering this as the reason for the decline.
Green color showing only 4 days
As we have told you that LIC's stock was listed on May 17. So far 21 days have been completed. During these 16 sessions of trading, it has shown green color for only 4 days. Meaning it has closed above its opening price after opening four days. In these two days (today and tomorrow), it has shown huge red colored candles. If we talk about weekly candles, then the colors of all four candles are red.
What do market experts say now?
According to a report by Live Hindustan, Sumeet Bagadiya, executive director of Coin Broking, has suggested the shareholders of LIC to maintain stop loss. He has said that LIC shares are looking weak on chart patterns and suggest LIC shareholders exit fast. They should maintain a tight stop loss at ₹750 level till the counter does not rebound.