Inside LIC’s Rs 16 lakh crore portfolio: Its biggest stock buys and sells in June quarter

India’s largest domestic institutional investor Life Insurance Corporation (LIC) of India bought an estimated Rs 16,578 crore worth of shares across its 10 biggest stock additions in the June quarter, led by Bharti Airtel, Maruti Suzuki and ITC. Yet the aggressive deployment failed to prevent LIC’s share of the NSE-listed equity market from falling to an all-time low, underscoring how rapidly the broader market expanded around India’s largest single asset manager.

Bharti Airtel attracted LIC’s highest buying during the quarter at an estimated Rs 2,721 crore. LIC increased its holding in the telecom company by nearly 1.47 crore shares to 25.82 crore shares as of June 30, according to data from PRIME Database.

Maruti Suzuki was the second largest purchase at Rs 2,267 crore, followed by ITC at Rs 1,742 crore. LIC added around 17.02 lakh Maruti shares and 5.84 crore ITC shares during the three-month period. The buying came as Maruti shares advanced 14.7%, while ITC slipped 0.26%.


Kotak Mahindra Bank attracted buying worth an estimated Rs 1,520 crore, while LIC deployed Rs 1,491 crore into UltraTech Cement. Reliance Industries, Bajaj Finance and Lupin followed with estimated purchases of Rs 1,425 crore, Rs 1,414 crore and Rs 1,375 crore, respectively.

Power Grid and Indian Railway Finance Corp. completed the list of LIC’s 10 biggest purchases, attracting Rs 1,340 crore and Rs 1,283 crore. LIC added more than 13.06 crore shares of IRFC, taking its holding to 46.22 crore shares at the end of June.

The buying was accompanied by substantial portfolio pruning. LIC sold an estimated Rs 13,406 crore across its 10 biggest stock reductions, led by Coal India and State Bank of India.

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Coal India saw the highest selling at Rs 2,271 crore after LIC reduced its holding by nearly 4.97 crore shares. SBI followed with an estimated selling of Rs 2,198 crore as the insurer cut its holding by 2.15 crore shares to 78.14 crore shares.

LIC also sold shares worth Rs 1,681 crore in HUL, Rs 1,497 crore in Steel Authority of India (SAIL) and Rs 1,415 crore in Tata Steel. Bharat Forge, Tata Consumer Products, ICICI Bank, Nestle India and ONGC were among its other major reductions.

Some of the selling came as stocks delivered strong returns. Bharat Forge advanced 28% during the quarter, while Nestle India gained 20%, SAIL rose 14.6% and ICICI Bank climbed 14%. In contrast, ONGC declined 17.5%, Coal India fell 2.5% and Tata Steel slipped 2%.

Across the broader portfolio covered by the tracker, LIC was a net buyer of an estimated Rs 8,137 crore during the quarter. Its holding increased in 54 NSE-listed companies but declined in 114 companies. The stocks where LIC raised its holding gained an average 11.19%, while those where it reduced exposure advanced an average 19.52%.

Despite the net buying, LIC’s share by value in NSE-listed companies declined to an all-time low of 3.48% as of June 30 from 3.72% at the end of March. Its share of the free-float market also dropped to 6.98% from 7.43%.

The decline came even as the market value of LIC’s equity holdings increased 7.72%, or Rs 1.17 lakh crore, to Rs 16.30 lakh crore. That combination suggests the value of the wider listed market expanded faster than LIC’s portfolio during the quarter.

Financial services further consolidated its position as LIC’s biggest sector exposure. The value of its financial holdings increased by Rs 55,288 crore to Rs 4.40 lakh crore, raising the sector’s share of the portfolio to 26.99% from 25.41%.

Information technology moved in the opposite direction. The value of LIC’s IT holdings declined by Rs 22,067 crore to Rs 1.50 lakh crore, cutting the sector’s portfolio weight to 9.18% from 11.35%. Its energy portfolio shrank by Rs 6,083 crore, with the sector’s weight falling to 13.72% from 15.18%.

Among individual companies, LIC more than doubled its holding in Central Bank of India to 6.44% from 3.16%. It also raised its stake in General Insurance Corp. to 11.65%, Lupin to 4.09%, Oil India to 8.08% and IRFC to 3.54%. Indian Hotels, SRF, Max Healthcare, Bharat Petroleum and NHPC were among its other biggest additions in percentage terms.

Reliance Industries remained LIC’s largest stock holding by value at Rs 1.18 lakh crore, followed by SBI at Rs 80,243 crore and Larsen & Toubro at Rs 70,124 crore. ITC, HDFC Bank, Bharti Airtel, IDBI Bank, Infosys, ICICI Bank and Tata Consultancy Services rounded out its 10 largest equity holdings.

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What should investors do?

Investors should use market volatility to gradually increase exposure to well-managed companies rather than attempt to time their entry, with quality large caps offering relatively stronger earnings visibility and balance-sheet resilience, money managers said. Financials, industrials and capex-linked businesses emerge as preferred areas, although the sharp correction in IT has divided opinion.

“It would be a mistake to try to time the market; instead, investors should use volatile situations to increase their exposure to well-managed businesses,” said Sandeep Neema, director and fund manager at PL Asset Management. He believes most macroeconomic headwinds have already been priced in, supported by declining inflation, policy stability, domestic liquidity and rising corporate profitability.

Prateek Agrawal, managing director and chief executive officer at Motilal Oswal Asset Management, said India’s valuation premium over emerging-market equities has dropped to a 10-year low after the recent underperformance. “Market valuations appear more aligned with historical trends,” he said. Banks and IT, which have a significant presence in large-cap indices, could consequently appeal to value investors following their correction, even though Agrawal continues to prefer higher-growth segments.

The earnings backdrop also supports a selective large-cap strategy. Among the 256 NSE 500 companies that had reported their first-quarter results, sales increased 22% from a year earlier while profit after tax rose 7%, according to ASK Investment Managers. Excluding energy companies, profit growth improved to 18%. Earnings strength was visible across metals, capital goods, non-bank lenders, banks, automobiles and utilities, while energy remained the primary drag.

ASK continues to prefer quality large caps while remaining selective in small- and mid-cap stocks. Its medium-term themes include domestic capital expenditure, financialisation, China-plus-one manufacturing, rural recovery, defence and electrification.

The sharpest disagreement is over IT. Agrawal sees the correction in the sector as an opportunity for value investors, while Neema remains conservative because of weakening global demand and disruption from artificial intelligence. Neema, however, sees opportunities in select IT companies with differentiated offerings.

The broader takeaway is to prioritise balance-sheet strength and earnings visibility, maintain exposure to financials and domestic capex-linked businesses, and approach IT and smaller companies through selective, company-specific bets.

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)