First Ever Bonus: 69-Year-Old Insurance Company Approves 1:1 Bonus Share Issue

The Indian equity markets traded lower on Wednesday, with the benchmark Nifty 50 index declining 0.43 per cent to 23,516.15 during the session. Insurance and financial services stocks remained in focus amid corporate announcements and shareholder approvals. In this segment, Life Insurance Corporation of India (LIC) traded marginally lower at Rs 803.00 after the company announced shareholder approval for its first-ever Bonus share issue through postal ballot voting.

LIC Receives Shareholder Approval For Bonus Issue

Life Insurance Corporation of India informed exchanges that shareholders approved the proposal for issuance of bonus shares through postal ballot and remote e-voting process. The company stated that the special resolution for issuance of bonus shares received 99.9998 per cent votes in favour and only 0.0002 per cent votes against the proposal.

The company approved capitalisation of Rs 6,324.99 crore from reserves and surplus for issuance of fully paid-up bonus equity shares in the ratio of 1:1. Under the approved proposal, shareholders will receive one bonus equity share of face value Rs 10 each for every one existing fully paid-up equity share held on the record date to be announced later.

First-Ever Bonus Issue Since Establishment

Established on September 1, 1956, LIC is completing 69 years of operations and this marks the company’s first-ever bonus share issue since inception. The development remains significant for market participants tracking shareholder reward initiatives by large public sector financial institutions.

The company currently commands a market capitalisation of around Rs 5.08 lakh crore, making it one of India’s largest listed financial services companies.

Additional Shareholder Approvals

LIC shareholders also approved re-appointment of Shri Mahalingam G and Dr. V.S. Parthasarathy as Independent Directors of the Corporation through special resolutions. Further, appointment of Ms. Shalini Pandit as Government Nominee Director and Shri Ramakrishnan Chander as Managing Director also received shareholder approval.

Share Price Performance

LIC shares have declined around 2.67 per cent over the past one month. The stock is down around 11.26 per cent over the last six months and has declined around 5.25 per cent over the past one year.

About LIC

Life Insurance Corporation of India is India’s largest life insurance company engaged in providing individual and group insurance products, pension plans, annuity products and investment-linked insurance solutions across domestic markets.

What are your views on LIC’s first-ever bonus share issue after nearly seven decades of operations? Share your thoughts in the comments below.
Disclaimer: This article is for informational purposes only and not investment advice.