LIC Takes ₹84,000 Crore Hit Amid Market Correction; ITC, L&T Among Top Drags

The ongoing correction in the Indian equity market has significantly impacted state-owned insurer Life Insurance Corporation of India (LIC), which has seen its stock holdings decline by ₹84,247 crore (5.7%) in the past one-and-a-half months. As of the December 2024 quarter, LIC’s total investment in listed companies stood at ₹14.72 trillion, which has now dipped to ₹13.87 trillion as of February 18, 2025. The decline is largely driven by a 10% drop in shares of ITC, Larsen & Toubro, and State Bank of India, contributing to 29% of the insurer’s overall loss.

The financial sector, including banks, NBFCs, and insurance companies, emerged as the biggest drag, wiping out ₹18,385 crore from LIC’s portfolio. Other affected sectors include information technology (₹8,981 crore), infrastructure (₹8,313 crore), power generation (₹7,193 crore), and pharmaceuticals (₹4,591 crore). Despite the downturn, select stocks such as Bajaj Finance, Maruti Suzuki, Kotak Mahindra Bank, Bharti Airtel, and JSW Steel added between ₹1,000 crore to ₹3,000 crore to LIC’s holdings, while Reliance Industries and Tata Consumer Products each contributed ₹840 crore.

Analysts predict continued volatility in the markets, with intermittent recoveries likely to be sold into. HSBC strategists suggest India’s valuation multiples may remain under pressure until earnings stabilize, citing weak Q3 FY25 results. A stronger US market and rising bond yields have further diverted foreign investor interest away from India, impacting fund flows. However, experts believe that sectors such as IT, consumer goods, and lenders with strong fundamentals may see long-term recovery amid a less restrictive monetary policy.

Pic Courtesy: google/ images are subject to copyright