India’s largest insurer reports ₹19,013 crore in net profit and declares ₹12/share dividend
Life Insurance Corporation of India (LIC), the country’s largest and most trusted insurance company, posted a strong financial performance in the fourth quarter of the financial year 2024–25. The company reported a 38% year-on-year increase in net profit, which rose to ₹19,013 crore compared to ₹13,763 crore in the same quarter last year.
Financial Highlights
LIC’s financial numbers for the fourth quarter reflect solid performance across multiple areas:
Net Profit: ₹19,013 crore, up 38% from the previous year’s ₹13,763 crore.
Dividend: A final dividend of ₹12 per share was declared for the financial year 2024–25. The record date for shareholders to be eligible for this dividend is July 25, 2025.
Solvency Ratio: Improved to 2.11 as of March 31, 2025, compared to 1.98 last year. A higher solvency ratio indicates stronger financial stability.
Assets Under Management (AUM): Increased to ₹54.52 lakh crore from ₹51.21 lakh crore, showing the company is managing more money than before.
What Drove the Growth?
Several key factors contributed to LIC’s impressive profit jump in the fourth quarter:
Lower Employee Costs
LIC’s employee-related expenses fell sharply to ₹5,928 crore during Q4 of FY25. A year earlier, this figure was much higher—₹13,750 crore. The drop is mainly because last year’s results included a one-time wage revision, which temporarily raised expenses. Since that was not repeated this year, the cost appeared much lower, boosting profits.
Focus on Non-Participating Insurance Products
Non-participating policies are those where the policyholder does not share in the company’s profits. These products typically offer better profit margins to the company. LIC has increased its focus on selling such policies, which has helped improve earnings.
Stronger Investment Returns
LIC’s investment income rose over 10% in the last quarter, reaching ₹93,133 crore. As an insurance company, LIC earns a large portion of its revenue by investing the premiums it collects. Higher returns from these investments played a key role in lifting profits.
How the Market Reacted
After the results were announced, LIC’s share price reacted positively. The stock rose by nearly 9% in intraday trade, reaching a high of ₹948 on the Bombay Stock Exchange. This sharp increase shows that investors are confident about LIC’s performance and prospects.
What Analysts Are Saying
Brokerage houses and investment experts have responded positively to LIC’s fourth-quarter earnings. Many have updated their stock ratings and increased target prices.
One leading brokerage has set a target price of ₹1,050 and marked the stock as a “Buy.”
Another has suggested a slightly lower target of ₹990 but still recommends it as a good buy.
A more optimistic estimate from a top firm sets the target at ₹1,260, based on continued strong performance and long-term growth potential.
These positive reviews reflect growing confidence among analysts about LIC’s ability to deliver steady returns.
Points of Caution for Investors
While LIC’s recent performance is encouraging, some areas require careful observation:
Drop in Premium Collection
Net premium income saw a slight decline of around 3% year-on-year. This was partly due to changes in rules that affected the structure of certain policies. While not a major issue at the moment, it is something that could impact revenue if it continues.
Stock Price Volatility
LIC’s stock has seen ups and downs since it was listed. Over the past year, it has traded as high as ₹1,221.50 and as low as ₹715.35. Although recent trends are positive, investors should be aware that stock prices can still fluctuate based on market conditions.
Regulatory Impact
The insurance industry is closely regulated by the government and financial authorities. Any changes in regulations, such as adjustments to policy pricing, benefits, or tax treatments, could affect LIC’s future business plans and profits.
Long-Term Outlook
LIC’s large customer base, brand trust, and investment strength give it a solid foundation. Its diversified products, both traditional and market-linked, help attract various types of policyholders. Moreover, its growing focus on high-margin, non-participating products could lead to improved earnings in the long run.
The company’s improved solvency ratio and growing assets under management also show that it is becoming more financially secure and capable of handling its future obligations.
In addition, LIC’s ability to generate strong investment income even during market volatility makes it a potentially stable pick for long-term investors.
Dividend Opportunity
The ₹12 per share dividend offers an added benefit for shareholders, especially long-term investors looking for both capital growth and regular income. Given the solid financial results, the company may continue offering dividends at similar or even higher levels in the future.
LIC’s 38% jump in Q4 profit highlights the company’s strong financial recovery and smart business strategy. With reduced costs, better investment returns, and a focus on high-margin insurance products, LIC is showing that it can perform well in both favorable and challenging market conditions.
The recent rise in stock price and positive analyst ratings suggest that the company could be a valuable addition to a diversified investment portfolio, especially for those seeking exposure to the insurance and financial services sector.
While certain risks remain, including regulatory changes and short-term premium income pressures, the long-term outlook appears promising. For investors looking at stability, dividends, and growth potential, LIC may offer a strong opportunity that should not be overlooked.
