Insurance Companies Stock Update: To say that insurance companies provide security cover to their policyholders. But the hard earned money of investors investing in government insurance companies is being looted. In the month of May, the country’s largest insurance company Life Insurance Corporation (LIC) has been listed on the stock exchange. Investors are suffering huge losses since the listing of LIC’s shares. Actually, this is not the first time that the stock of a government insurance company has been beaten on the stock exchange. In the last five years, there has been a huge dent in the capital of the investors who have invested in the shares of all the government insurance companies that have come up with IPOs.
GIC stock status
In the year 2017, the IPO of General Insurance Corporation of India (GIC RE) came in the market. Then the IPO of GIC was the third largest IPO. Prior to that, Coal India had come up with an IPO of Rs 15,200 crore and Reliance Power Rs 11,000 crore. GIC raised Rs 11,370 crore from the market through IPO. The company had fixed an issue price of Rs 912. A year after the IPO, the company gave a bonus share for one share. Due to which the amount of investment per share came down from Rs 912 to Rs 456. But the stock of GIC was beaten in such a way that on June 3, 2022, the stock is trading close to Rs 120. That is, investors are incurring a loss of Rs 336 per share. Meaning investors are losing 74 percent on their investment.
Share of New India Insurance
In 2017 itself, after the IPO of GIC, General Insurance Company New India Insurance (New India Assurance) came up with its IPO. The company raised Rs 9,600 crore through IPO. The company had fixed the issue price of Rs 800 per share. New India Insurance also gave investors a share in the form of bonus for one share in 2018. But on giving bonus, with the increase in the number of shares, the price is reduced to half. That is, the burden came on the investors by Rs 400 per share. But as of today, the share of New India Insurance is trading close to Rs 101. The investors are incurring a loss of Rs 300 per share. That means close to 75 percent.
Same condition of LIC
In the month of May this year, the country’s largest insurance company LIC came out with its IPO, which was the largest IPO in the history of India’s IPO market. LIC has raised Rs 20,557 crore from the market through IPO. But since the listing, the decline in LIC’s stock is not taking its name to stop. The share of Life Insurance Corporation of India (LIC) has fallen to the low levels of Rs 801. In terms of IPO price of Rs 949, the market capitalization of LIC was close to Rs 6,00,242 crore. Which has come down to Rs 5.06 lakh crore. Investors are now facing a loss of Rs 148 per share. That is, investors are facing a loss of Rs 94,000 crore.
Private insurance companies gave great returns
The shares of government insurance companies may have disappointed the investors, but the shares of private insurance companies have given excellent returns to the investors. Which includes shares of SBI Life Insurance with HDFC Life, ICICI Lombard, ICICI Prudential.