Investors Have Lost Rs. 1.4 Billion Since Listing as LIC Shares Reach All-Time Lows; What Comes Next
LIC Shares: On Thursday, LIC shares reached a new all-time low for the ninth day in a row, dropping to Rs 731.10 per share on the BSE. The insurance company's market valuation was down today to Rs. 4.61 lakh crore. On Thursday, the stock fell a further 2%, falling to Rs 723.7, before beginning to somewhat recover. Since their issue price of Rs 949, LIC shares have lost roughly one-fourth of their value. Investors have endured anguish as LIC's Dalal Street journey thus far has seen the stock wipe out more than its investment of Rs 1.4 lakh crore worth.
On the day of the weekly F&O expiry, both the BSE Sensex and the NSE Nifty 50 were considered weak. The BSE Sensex has reached a day low of 54,507.41 so far in the session, while the NSE Nifty 50 has reached 16,243.85.
The highly underserved life insurance industry in India is still in its infancy and is well-positioned to take advantage of the immense development potential, according to Santosh Meena, Head of Research, Swastika Investment.
"LIC offers a variety of competitive advantages, such as a strong brand value, a sizable agent network, and an enviable distribution network, "Added he. "Investors with a long
Data reveals that since May 17, when shares of LIC went public, the company has only finished with a gain four times. It has fallen apart over the past few days due to selling pressure.
According to Aamar Deo Singh, Head Advisory, Angel One, LIC shares are still being sold off as a result of worries about rising prices and dwindling liquidity. Singh advised long-term shareholders of the stock not to let daily price fluctuations affect their decisions. Technically, he claimed, the stock must continuously trade above the 840 level for the trend to change.
Proficient Equities Private Limited's founder and director, Manoj Dalmia, stated that "LIC's share price prolonged its decline mode and set a new low of Rs751.50 on NSE. After a gap-down opening, the share price of LIC reached an intraday low of Rs. 753.0, breaking through yesterday's low. After reaching a new low, today's LIC share price was quoted at about 21% less than its initial issue price of Rs 949 for an equity share.
According to him, the stock's failure to draw in FIIs, Q4 results that weren't all that encouraging, and the lack of comparable valuations, which make valuation abstract to investors, are among the likely causes.
The outlook for the company, according to Dalmia, will be gloomy because the anchor investor lockin will terminate by the middle of this month, and the price pattern also supports this. Investors are recommended to refrain from big stock purchases and avoid averaging until a price reversal is evident since the downside levels are Rs. 741 and Rs. 713.-term perspective can purchase this stock at the going rate and use the buy on dip method."
Vice Chairman of GCL Securities Limited Ravi Singhal stated, "As we can see, the stock is continuously dropping after listing. The following elements are at fault: In addition to the listing being below the issue price, the results fell short of expectations, trapping many investors, especially novice ones. Investment valuations decline in tandem with negative market developments. The direct sales vertical is also successful, but the market is waiting to see whether it will switch to an online platform or if it will keep losing market share. Technically, It also seems to be frail. Right now, it's been oversold. Therefore, sell when prices increase around Rs 777 with an Rs 822 stop loss and a Rs 677 target. Long-term investors can maintain it, but until it starts doing business online, it won't do better than the Nifty.