Motilal Oswal Recommends Buy Large Cap Insurance Sector Stock, Sees 38% Strong Return

Broking firm Motilal Oswal has come up with a Buy rating on the Life Insurance Corporation of India (LIC). Brokerage assigns a target price of Rs. 830 apiece on the stock. The broking firm, with the given target price, sees a robust upside of up to 38% from its current level. LIC is a large-cap insurance company with a market capitalisation of Rs. 3,83,263 crore.

Buy with a TP of Rs. 830/share

According to Motilal Oswal, LICI has the levers in place to maintain the industry-leading position and ramp up growth in the highly profitable product segments (mainly Protection, Non-PAR, and Savings Annuity). However, changing gears for such a vast organization requires a superior and well-thought out execution. "We expect LICI to deliver a 15% CAGR in APE over FY23-25, thus enabling a 27% VNB CAGR. However, we expect operating RoEV to remain modest at 10.9%, given its lower margin profile than private peers and a large EV base. LICI is trading at 0.6x FY24E EV, which appears reasonable considering the gradual recovery in margin and diversification in the business mix. We maintain our BUY rating with a TP of INR830 (0.8x Sep'24E EV)," the brokerage has said.

Stock Outlook

On NSE, the share price of LIC is currently trading at Rs. 605.75 apiece, up 0.36% compared to its previous close of Rs. 603.60 apiece. The stock's 52 week high is Rs. 841.45 apiece recorded on May 25, 2022, and 52-week low is Rs. 530.05 apiece recorded on March 29, 2023.

It jumped 7.26% in 1 week and 10.63% in 1 month, respectively. However, it has fallen 25.34% in the past 1 year. Since its date of listing, its stock declined 30.76%. The stock was listed on May 17, 2022.

About - Life Insurance Corporation of India (LIC)

Life Insurance Corporation of India (LIC) is the largest insurance provider company in India. The company offers participating insurance products and non-participating products like unit-linked insurance products, term insurance products, saving insurance products, health insurance, and annuity & pension products.

Disclaimer - The stock has been picked from the brokerage report of Motilal Oswal. Greynium Information Technologies, the Author, and the respective Brokerage house are not liable for any losses caused as a result of decisions based on the article. Goodreturns.in advises users to consult with certified experts before making any investment decision.

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Motilal Oswal Recommends Buy Large Cap Insurance Sector Stock, Sees 38% Strong Return

Broking firm Motilal Oswal has come up with a Buy rating on the Life Insurance Corporation of India (LIC). Brokerage assigns a target price of Rs. 830 apiece on the stock. The broking firm, with the given target price, sees a robust upside of up to 38% from its current level. LIC is a large-cap insurance company with a market capitalisation of Rs. 3,83,263 crore.

Buy with a TP of Rs. 830
According to Motilal Oswal, LICI has the levers in place to maintain the industry-leading position and ramp up growth in the highly profitable product segments (mainly Protection, Non-PAR, and Savings Annuity). However, changing gears for such a vast organization requires a superior and well-thought out execution. "We expect LICI to deliver a 15% CAGR in APE over FY23-25, thus enabling a 27% VNB CAGR. However, we expect operating RoEV to remain modest at 10.9%, given its lower margin profile than private peers and a large EV base. LICI is trading at 0.6x FY24E EV, which appears reasonable considering the gradual recovery in margin and diversification in the business mix. We maintain our BUY rating with a TP of INR830 (0.8x Sep'24E EV)," the brokerage has said.

Stock Outlook

On NSE, the share price of LIC is currently trading at Rs. 605.75 apiece, up 0.36% compared to its previous close of Rs. 603.60 apiece. The stock's 52 week high is Rs. 841.45 apiece recorded on May 25, 2022, and 52-week low is Rs. 530.05 apiece recorded on March 29, 2023.

It jumped 7.26% in 1 week and 10.63% in 1 month, respectively. However, it has fallen 25.34% in the past 1 year. Since its date of listing, its stock declined 30.76%. The stock was listed on May 17, 2022.

About - Life Insurance Corporation of India (LIC),
Life Insurance Corporation of India (LIC) is the largest insurance provider company in India. The company offers participating insurance products and non-participating products like unit-linked insurance products, term insurance products, saving insurance products, health insurance, and annuity & pension products.
Disclaimer - The stock has been picked from the brokerage report of Motilal Oswal. Greynium Information Technologies, the Author, and the respective Brokerage house are not liable for any losses caused as a result of decisions based on the article. Goodreturns.in advises users to consult with certified experts before making any investment decision.