LIC Stock Rises After Q3 Earnings: Shares of Life Insurance Corporation of India (LIC) were trading higher on Monday after the company reported a 16 per cent year-on-year (YoY) growth in consolidated net profit for the December quarter, reaching Rs 11,009 crore compared to Rs 9,469 crore in the same period last year.
The net premium income for Q3FY25 stood at Rs 1,07,302 crore, marking a 9 per cent decline from Rs 1,17,432 crore in the corresponding quarter of the previous financial year.
The profit after tax (PAT) surged by 42 per cent on a sequential basis compared to Rs 7,729 crore in Q2FY25.

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Brokerages have noted that LIC delivered a strong margin profile for the quarter, despite the implementation of new surrender regulations, with the Value of New Business (VNB) margin at 19.4 per cent, supported by an increased Non-Par mix. However, APE (Annual Premium Equivalent) growth continued to face challenges, with a 24 per cent decline in Q3FY25.
Brokerages are generally positive on LIC following the Q3 results, with target prices indicating potential upside of up to 33 per cent.
To counter the impact of the new surrender regulations, LIC’s management has redesigned its product and commission structures and revised the minimum ticket size of policies to improve persistency, according to Emkay Global. The management is also focused on driving growth in non-Par products through new product launches.
“Looking ahead, LIC expects growth to rebound, driven by an increase in the number of policies sold and the average ticket size. Reflecting the Q3 performance, we have reduced our APE estimates by 6 per cent and increased our VNB margin estimates by 220-320bps, resulting in a 7-12 per cent increase in our VNB estimates for FY25-27. We maintain an ‘ADD’ rating while revising our Dec-25E target to Rs 1,100 from Rs 1,150, reflecting a 4.3 per cent cut," the domestic brokerage stated.

Goldman Sachs has maintained a neutral rating on LIC with a target price of Rs 900 per share. The company’s topline performance fell short of expectations, primarily due to a 38 per cent YoY decline in individual participating businesses, along with weakness in the group segment. Margins contracted as the benefit from a better product mix was offset by lower risk-free rates.

MOFSL stated that LIC has maintained its industry-leading position and is focusing on ramping up overall growth through broader product offerings, a shift in the product mix toward non-par, strengthening the agency channel, and further digitization.

“LIC has aligned distributor incentives to absorb the impact of surrender charges. With the introduction of a new hedging mechanism, the company is confident of mitigating uncertainties around VNB and expects product-level margins to remain intact," MOFSL said.

The brokerage has reduced its net premium, APE, and VNB margin estimates by 4 per cent each for FY25, factoring in Q3FY25 performance. With the increasing share of the non-par segment, it expects VNB margin improvement. For now, MOFSL has a ‘Buy’ rating with a target price of Rs 1,085.