
According to recent data, the total assets under management (AUM) of India’s state-owned insurance giant, Life Insurance Corporation of India (LIC), have surpassed the Rs 50 lakh crore mark. This amounts to nearly double the size of neighboring Pakistan’s GDP. As of March-end, LIC’s AUM stood at Rs 51,21,887 crore ($616 billion), reflecting a year-on-year increase of 16.48%. In comparison, Pakistan’s GDP is around $338.24 billion, as reported by the International Monetary Fund (IMF). LIC’s AUM has now become almost twice the size of Pakistan’s economy.
LIC’s AUM Exceeds GDP of Neighboring Countries and Developed Territories
LIC’s enormous fund size has garnered attention not only in comparison to Pakistan’s GDP but also in relation to its neighboring countries. The AUM of LIC is larger than the combined GDPs of Pakistan ($338 billion), Nepal ($44.18 billion), and Sri Lanka ($74.85 billion). Moreover, LIC’s AUM also exceeds the GDPs of developed territories like Denmark ($410 billion), Finland ($308 billion), Singapore ($525 billion), and Hong Kong ($407 billion).
Economic Contrasts Between India and Pakistan
The contrast between India and Pakistan’s economic situations is evident. While India is emerging as an economic superpower, Pakistan has been grappling with debt and narrowly avoided a sovereign debt default recently. The IMF has expressed concerns about Pakistan’s ability to repay its debts due to high political uncertainty and a resurgence of social tensions, which could undermine economic stabilization policies. The IMF estimates that Pakistan will require gross financing of $123 billion over the next five years.
LIC’s Financial Performance and Market Presence
In the financial year 2023-24, LIC reported a profit of Rs 40,676 crore and a total premium income of Rs 4,75,070 crore. The company allocated a bonus of Rs 52,955.87 crore to participating policyholders during the same period. With a market share of nearly 59% in the Indian life insurance business, LIC is now exploring opportunities to enter the health insurance sector and is evaluating potential acquisition prospects.
Government Ownership and Market Position
LIC is primarily owned by the Indian government, which holds a 96.5% stake in the company through the President of India. As the 7th largest stock by market capitalization, LIC’s shares have seen significant growth, with a 52% increase in the past six months. The Securities and Exchange Board of India (SEBI) has extended the timeline for LIC to achieve 10% public shareholding until May 2027 and 25% public holding until 2032, removing the overhang on the stock caused by an offer for sale (OFS).
Political Discussions and Market Outlook
Being a government-owned entity, LIC has been a topic of political discussions. Prime Minister Narendra Modi addressed the Parliament in February, stating that the opposition used to spread false stories about LIC. LIC’s shares ended Tuesday’s session lower by 1.4% at Rs 1,021.4 on the Bombay Stock Exchange (BSE). Global brokerage firm JP Morgan has maintained an ‘Overweight’ rating on LIC, with a target price of Rs 1,340.