In less than a month of losing the tag—most valuable public sector undertaking (PSU),
State Bank of India (SBI) reclaimed the lost crown on Tuesday, after a sell-off in the Life Insurance Corporation's shares eroded more than
₹70,000 crore of market capitalisation over the last three days. At
₹6.3 lakh crore, SBI currently commands about
₹250 crore higher market cap than that of LIC.
The
sell-off in PSU stocks has wiped out investor wealth of more than
₹5 lakh crore over the last three days, after lower-than-expected earnings for the third quarter of FY24 from a handful of PSUs and stretched valuations led to profit booking.
However, a 7% growth in annual premium equivalent (APE) in Q3 failed to arrest a nine-month decline, yet the focus on profitable non-par plans remains a positive.
BOB Capital Markets, which downgraded the stock to 'hold' from 'buy' on stretched valuations, wrote, "Though we remain positive on
LIC given its entrenched brand equity and market leadership, the recent 30% plus rally leaves just 5% upside and compels us to downgrade the stock from '“buy' to 'hold'.
Of the 19 analysts who track the stock on Bloomberg, 63% have a 'buy' recommendation on the stock. While 26% suggest a 'buy,' the remaining 11% have a 'sell' rating on the stock.
(Edited by : Ajay Vaishnav)