LIC share price rises 5% on announcement of first-ever 1:1 bonus issue

LIC has approved the issuance of first-ever bonus equity shares in the proportion of 1:1. LIC is yet to announce the bonus record date.

LIC shares jump 5% on announcement of 1:1 bonus issue

Deepak Korgaonkar Mumbai

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LIC share price today: Shares of Life Insurance Corporation of India (LIC) gained 5 per cent to ₹844.85 on the BSE in Wednesday’s intra-day trade amid heavy volumes after the company announced a bonus issue in the ratio 1:1.

So far in April, the stock price of the state-run insurer has rallied 16 per cent. In comparison, the BSE Sensex has jumped 8.4 per cent during the same period. However, in the past six months, LIC has underperformed the market by falling 7.3 per cent, as against a 5.6 per cent decline in the benchmark index.

At 11:45 AM, LIC was trading 4 per cent higher at ₹834.75 on the BSE. The average trading volumes more than doubled, with a combined 3.18 million equity shares changing hands on the NSE and BSE.

The stock price of LIC had hit a record high of ₹1,221.50 on August 1, 2024. It touched an all-time low of ₹530.20 on March 29, 2023. Shares of LIC got listed on the exchanges on May 17, 2022. The insurance behemoth had issued shares at ₹949 apiece to institutional investors, and at ₹904 to retail investors and employees.

LIC board announces 1:1 bonus issue

The board of directors of LIC, in their meeting held on April 13, 2025, considered and approved the issuance of bonus equity shares in the proportion of 1:1 to the existing shareholders as on the record date, which shall be announced subsequently. The issuance of bonus equity shares shall be subject to the approval of shareholders, LIC said in a filing.

A 1:1 bonus issue means shareholders will receive one fully paid-up equity share of ₹10 each for every share held. This is the first time that LIC has announced a bonus issue since listing in 2022.

LIC in statement said that the board decided that the proposed issuance of bonus shares in the ratio of 1:1 is an appropriate way to reward the members for their continued support and trust in LIC and helps in bringing a balance between paid-up capital and accumulated reserves of LIC and also enhance liquidity and marketability by making the share more affordable and attractive to a broader range of investors.

Further, it clarified that the proposal for the issue of bonus shares shall not impact the solvency margin and any other financial parameters of LIC.

The bonus issue will lead to a doubling of paid-up equity capital to ~₹12,650 crore from ₹6,325 crore, while the number of outstanding shares will increase to ~12,650 million from ~6,330 million. The issuance involves capitalisation of reserves worth ~₹6,325 crore, out of LIC’s surplus of over ₹14.64 trillion as of December 2025, and remains subject to shareholder approval, with allotment expected to be completed within two months.

“Since listing in May 2022, LIC has been paying dividends consistently and also increasing the dividend per share over a period of time from ₹1.50 per share to ₹12 per share. We have been continuously evaluating various mechanisms for rewarding our shareholders and we believe this proposed bonus issue is a significant step taken by us in that direction,” said R Doraiswamy, CEO & MD, LIC.

LIC stock: Analyst view

LIC has witnessed a steady correction since February, declining from levels around ₹900 and eventually forming a base near the ₹720 mark. Notably, the stock found support around its previous swing low in the ₹715–₹720 zone, indicating a strong demand area, said Harish Jujarey, AVP and head of technical equity research at Prithvi Finmart.

Currently, the stock is trading within a triangle pattern, suggesting a phase of consolidation. The ongoing up move appears to be a pullback rally, which could extend towards the 200-day moving average placed near the ₹870 level. Traders with existing long positions are advised to consider profit booking on rallies towards the ₹870 – ₹880 zone, said the analyst.

Meanwhile, macro uncertainty has impacted life insurers in March, with delayed purchases during their seasonally strongest month. Elevated bond yields have further weighed on investment portfolios, according to analysts at JM Financial Institutional Securities.

The brokerage firm expects full-quarter APE (Annual Premium Equivalent) growth at 17 per cent for LIC. With a weakening macro (delayed purchases and spike in debt yields), the recovering GST impact on margins will be lower than initially expected. Analysts expect Y-o-Y margin deterioration of 202bps for LIC. While the insurers report March 2026 quarter (Q4) numbers, the brokerage firm said they await clarity on any action on commission payouts, which is weighing in on valuations. ==========================

Disclaimer: View and outlook shared belong to the respective brokerages/analysts and are not endorsed by Business Standard. Readers' discretion is advised.

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First Published: Apr 15 2026 | 12:53 PM IST