LIC Shares Surge as Investments in Indian Infrastructure Pay Off

LIC shares have surged by nearly 79% due to strategic investments in India's infrastructure sector, outperforming rival insurance companies. Analysts highlight the importance of such investments for long-term returns and risk management. Meanwhile, private sector insurers with minimal exposure to infrastructure have seen comparatively poor stock performance.

Life Insurance Corporation (LIC) shares have surged nearly 79%, from Rs 620 on July 18, 2023, to Rs 1,109.15 on Tuesday, according to stock exchange data. This performance has outshined competitors like HDFC Life and ICICI Prudential Life.

LIC's strategic investments in India's growth-centric infrastructure sector have proven successful, while the private sector focused on tech, consumer, and BFSI companies. HDFC Life and Kotak Mahindra Bank, with minimal infrastructure exposure, lagged behind.

Capital market analysts emphasize that insurance companies generate significant profits by investing premiums in assets. Global giants like Berkshire Hathaway benefit from higher infrastructure investments, a strategy yet to be fully realized by Indian insurers. Analysts recommend a stronger focus on infrastructure for long-term stability and growth.

(With inputs from agencies.)