Demonetisation's by Product: Profit Booking by Insurance Giant, LIC

Insurance giant, Life Insurance Corporation of India (LIC), which holds roughly 5%, which is worth $66 billion in the BSE200 companies, has booked profit in GAIL, Hindalco Industries, Hero MotoCorp, SBI, HPCL, IOC, PFC and Tata Communications in the last quarter, according to Bloomberg, BSE & NSE.

LIC’s holding has decreased 1.7% in GAIL (worth Rs 9431 cr); 1.7% in Hindalco Industries (worth Rs 5641 cr); and 1.2% in Hero MotoCorp (worth Rs 7911 cr).

The insurance behemoth, on the brighter side, was seen buying stocks of companies like NMDC, Dr. Reddy’s Laboratories, CESC and Dewan Housing Finance to name a few.

LIC’s holding increased 1.9% in NMDC (worth Rs 10220 cr);1.7% in CESC (worth Rs 1365 cr); and 1.6% in Dewan Hosing Finance (worth Rs 1369 cr).

All this action was underway when the Central Government was implementing its demonetisation drive. The demonetisation move is believed to have squeezed demand and slowed down industry growth, eventually hampering the overall economic growth rate.