LIC booked profit in SBI, GAIL, DRL & others, when you were lining up at ATMs

NEW DELHI: Life Insurance Corporation of India (LIC), which holds roughly 5 per cent stake worth $66 billion in the BSE200 companies, was seen booking profits in state-run GAIL, SBI, HPCL, IOC and Indraprastha Gas, among others, all through December quarter, when the government’s demonetisation drive squeezed demand and slowed down industry, halting economic growth on the tracks.

On the flip side, the insurance behemoth was seen buying select private sector names such as Dr Reddy’s Laboratories, GlaxoSmithKline Consumer Products, Pidilite Industries and Grasim Industries, among others.

The quarter was marked by profound weakness in the stock market – with LIC itself offloading $3 billion worth of BSE200 stocks.

LIC’s holding in GAIL fell by Rs 943.10 crore during the quarter. However, this was covered by marked-to-market gains on the counter, as the scrip rose 17 per cent during the period.

The insurer held 9.7 per cent stake in the state-run gas company at the end of December quarter, down 170 basis points from over 11.4 per cent it had at the end of September quarter, a report by Kotak Institutional Equities showed.

LIC cut its stake in Indraprashta Gas (owned by state-run BPCL and GAIL) o 2.8 per cent at the end of December quarter from 3.5 per cent in September quarter. This stock rose 18 per cent during December quarter.

SBI saw LIC pare its stake by 70 basis points to 9.8 per cent in the third quarter from 10.4 per cent in the second quarter. In value terms, it was worth Rs 1,312 crore. SBI shares stood flat for the quarter.

IOC (up 11.76 per cent on adjusted basis, including bonus issue), HPCL (up 4 per cent), PFC (up 1.5 per cent) were some of the stocks that witnessed selling by the state-run insurer but remained unfazed by the demonetisation drive.

That said, LIC was seen buying shares of Dr Reddy’s Labs. Its holding in the drugmaker rose by 2.90 basis points to 14.4 per cent. This stock was down 1.6 per cent in Q3 of FY17.

Dewan Housing Finance, Pidilite Industries GlaxoSmithkline Consumer, Pidilite Industries, Britannia Industries and Bata India, among others, were some of the stocks where LIC increased its stake by up to 19 basis points in the challenging quarter. (See table)