The Life Insurance Corporation is all set to pump in an additional over Rs 4,000 crore (about $1 billion) in the equity market by March 2009, a move that could bolster the volatile bourses.
“We have made investment of Rs 31,000 crore till December and it may cross Rs 35,000 crore (by the end of March),” the LIC chairman, Mr T.S. Vijayan, said.
However, even the huge quantum of fund infusion this year is quite less by the standards that LIC has itself set, as it would be 15 per cent less than
Rs 41,000 crore that it invested in equity during the last fiscal year.
As a result, the cumulative investment in equities by March 2009 must be touching Rs 2,00,000 crore, he said.
“Yes it (exposure to equities) is continuously growing. I believe, of all the listed companies’ market capitalisation, There may be around four per cent with us. It is huge money,” he said.
“We have a responsibility. Responsibility to policy holders. Whether the company is performing or not or we have to take investment decision, whether to continue with the company or get out of it,” he added.
The public sector insurer is putting in more funds in the equity market at a time when it is seeking to resolve the issues that followed a 10 per cent equity cap announced by insurance regulator IRDA in August.
“If they are changing the goal posts, we are asking them (IRDA) to teach us how to score goals next time,” he said.
On being compared with private sector competitors in terms of hiring plans, Mr Vijayan said, “They (private insurers) are talking about 30,000. We are talking about 11-12 lakh and that is the difference. (In) three years, we want to double the number of agents.”