The Life Insurance Corporation of India (LIC) disclosed that it has decreased its stake in Bajaj Auto from 7.203% to 5.200%. Following this, the shares of Bajaj Auto were trading at ₹ 3561.00 apiece, down 1.17% at 11:33 AM on the National Stock Exchange (NSE).
LIC sold 56,68,366 shares, or 2.003% equity, at an average cost of Rs 4,069.65 via open market transactions during the period from 3 November 2022 to 16 November 2022.
Bajaj Auto is the flagship company of the Bajaj Group. It manufactures two-wheelers and three-wheelers. Headquartered in Pune, India, the company has acquired 48% of the KTM Brand which manufactures sports and super sports two-wheelers.
It commands a market capitalization of ₹ 1,04,529 crore. Its shares were trading at a price-to-equity ratio (P/E) of 18.24, which is higher than the industry P/E of 12.06. The company has an ideal return on equity of 21.58%.
LIC on the other hand is an insurance behemoth. It has been providing life insurance In India for over 65 years and has a market share of over 66% in new business premiums. It debuted on the bourses on 17 May 2022 and was India’s biggest IPO.
The state-owned insurer has a market capitalization of 4,07,235 Crore. It has an excellent return on equity of 45.27% and an ideal debt-to-equity ratio of 0.00. Its shares were trading at a price-to-equity ratio (P/E) of 104, which is higher than the industry P/E of 10.23, therefore, its shares might be overvalued.
Written by Simran Bafna
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