LIC’s ₹15.5 lakh crore portfolio revealed: Stocks India’s largest domestic investor bought and sold in Q2

Life Insurance Corporation (LIC) of India reshuffled its massive equity portfolio in the September quarter, buying into Larsen & Toubro (L&T), Reliance Industries and Bharti Airtel while cutting exposure to ICICI Bank, State Bank of India and Nestle India.

LIC’s equity holdings stood at ₹15.49 lakh crore as of Sept. 30, according to data from Prime Database. That was a 4.97% decline from the previous quarter, even as the insurer remained a net buyer of equities worth ₹7,346 crore.

The value of LIC’s holdings fell as its share of companies listed on the National Stock Exchange declined to 3.38% from 3.50% in the June quarter, an all-time low. Measured only against free-float shares, LIC’s ownership also declined to 6.80% from 7.03%.

Despite the decline in its overall ownership share, LIC remains India’s largest single asset manager. Its equity holdings are nearly twice the size of those of the country’s largest mutual fund house, according to Prime Database.

LIC’s largest purchase in the September quarter was Larsen & Toubro, where it bought shares worth ₹4,153 crore. The insurer increased its holding by 1.06 crore shares, even as the stock fell 9.25% during the quarter.

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Reliance Industries was the second biggest purchase. LIC bought shares worth ₹3,967 crore, raising its holding by 3.09 crore shares. Reliance stock declined 8.26% during the period.

The insurer also bought ₹3,878 crore worth of Bharti Airtel, increasing its holding by 2.04 crore shares. Airtel’s stock fell 5.13% during the quarter.

LIC’s other major purchases included Maruti Suzuki India, where it bought shares worth ₹2,968 crore as the stock declined 15.22%. It bought ₹2,926 crore worth of NTPC and ₹2,508 crore of Power Grid Corp. of India, even as the two stocks fell 9.51% and 9.01%, respectively.

LIC also bought ₹2,465 crore worth of Eicher Motors, ₹2,419 crore of UltraTech Cement, ₹2,365 crore of Mahindra & Mahindra and ₹2,261 crore of Power Finance Corp.

Across these 10 companies, LIC’s estimated net buying amounted to ₹29,910 crore. The calculation is based on the change in shareholding multiplied by the volume-weighted average closing price during the quarter.

The buying pattern shows a preference for large companies in infrastructure, energy, telecom, automobiles and financial services. It also indicates that LIC added to several positions as stock prices declined during the quarter.

LIC’s largest sale was in ICICI Bank. It reduced its holding by 3.16 crore shares, equivalent to an estimated net sale of ₹4,453 crore. The stock declined nearly 4% during the quarter.

State Bank of India was the second largest sale. LIC cut its holding by 3.10 crore shares, worth an estimated ₹3,209 crore. SBI fell 6.56%.

The insurer also sold ₹2,623 crore worth of Nestle India, even as the stock declined 6.77%. It sold ₹2,095 crore worth of Divi’s Laboratories, although the stock gained 41.23% during the quarter.

LIC further reduced its holdings in Tech Mahindra by ₹1,926 crore, Zydus Lifesciences by ₹1,889 crore, Hindustan Zinc by ₹1,826 crore, Coal India by ₹1,579 crore, Tata Motors by ₹1,566 crore and BSE by ₹1,477 crore.

The estimated value of LIC’s top 10 sales stood at ₹22,643 crore.

LIC’s portfolio changes were not limited to its largest purchases and sales. The insurer raised its stake in Zee Entertainment Enterprises to 3.56% from less than 1% and increased its holding in REC to 5.66% from 3.33%.

It also raised its stake in Power Finance Corp., Oil India, Tata Motors Passenger Vehicles, Britannia Industries, Cochin Shipyard, Eicher Motors and Bharat Petroleum.

Reliance Industries remained LIC’s largest equity holding by value at ₹1.12 lakh crore. It was followed by State Bank of India at ₹71,999 crore and Larsen & Toubro at ₹67,605 crore.

LIC’s other large holdings included ITC at ₹54,174 crore, Bharti Airtel at ₹48,953 crore, HDFC Bank at ₹46,321 crore, Infosys at ₹43,601 crore, IDBI Bank at ₹43,518 crore, Tata Consultancy Services at ₹41,955 crore and ICICI Bank at ₹37,035 crore.

In terms of percentage ownership, LIC held its largest stake in IDBI Bank at 49.24%, followed by LIC Housing Finance at 45.24% and ITC at 16.45%.

LIC’s Q2 strategy was therefore a mix of accumulation and pruning. It added aggressively to L&T, Reliance, Airtel, power companies and select automakers, while reducing exposure to major banks, consumer companies and several stocks that had performed strongly.

For investors tracking India’s largest domestic asset manager, the latest disclosures show that LIC continues to favour large, established companies. At the same time, it is willing to buy into market weakness while reallocating capital away from selected holdings.

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