LIC’s consolidated net profit rose sharply to Rs 8,334 crore in the third quarter as against Rs 235 crore in the same period a year ago as premium income improved and it moved Rs 5,670 crore to its shareholders' fund to shore up its net worth.
Retail investors and company employees, who received a discount of Rs 45 per shares, are sitting at a wealth erosion of 37 per cent from their adjusted issue price of Rs 904.
Experts believe that with liquidity becoming tighter and credit demand remaining strong, lending institutions are in the race to acquire the maximum deposits. SFBs are offering FD rates that are 75-100 basis points higher than those offered by PSBs and private banks.
LKP Securities estimates bank credit growth to be around 15% for FY24, around 400bps higher of India’s nominal GDP. Deposit growth is expected to be at 11% as the banks are raising the deposit rates.
So far this year banking stocks have been an underperformer even as credit growth has been encouraging. However, deposit growth has lagged that has led to concerns over contraction in margins.