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Life Insurance Corporation of India (LIC) has delivered a strong set of Q4 and FY26 earnings, reporting its highest-ever annual profit and significant expansion in business margins, prompting Religare Broking to reiterate a ‘Buy’ rating on the stock with a target price of ₹1,125implying an upside potential of over 33% from the current market price of ₹845.

For FY26, LIC reported a record profit after tax (PAT) of ₹57,419 croremarking a 19.3% year-on-year growthwhile total premium income rose 9.8% YoY to ₹5.36 lakh crore. The insurer’s Annualized Premium Equivalent (APE) increased 17.8% YoY to ₹66,961 crorereflecting healthy traction across key product segments and improved business quality.

A major highlight of the year was LIC’s sharp improvement in profitability metrics. The company’s Value of New Business (VNB) surged 41.6% YoY to ₹14,179 crorewhile VNB margin expanded 360 basis points to 21.2%driven by a stronger contribution from high-margin non-participating (non-PAR) products and favorable economic assumptions. Individual non-PAR APE jumped 43.8% YoY to ₹15,214 croreincreasing its share in individual APE to 35.1%signaling a structural shift toward more profitable business segments.

LIC also saw robust growth in digital and alternative distribution channels. New business premium from banca and alternate channels climbed 45.2% YoY to ₹5,076 crorecrossing the ₹5,000 crore milestone for the first time, while digital policy issuance through the ANANDA platform rose 56% YoY to nearly 24 lakh policiesreflecting the insurer’s accelerating digital transformation efforts.

In the March quarter, LIC posted a strong operational performance with Q4FY26 PAT rising 23.3% YoY to ₹23,467 crorewhile New Business Premium (NBP) grew 46.7% YoY to ₹1.03 lakh crore. Quarterly VNB more than doubled, rising 117.9% YoY to ₹7,702 crorewith VNB margin improving to 26.6%underscoring strong profitability momentum in the closing quarter of the fiscal year.

Despite strong operational gains, LIC’s Embedded Value (EV) growth remained subdued at 1.6% YoY to ₹7.89 lakh croreimpacted by mark-to-market losses in equity and debt portfolios during the March 2026 market volatility. However, the company’s balance sheet strengthened, with the solvency ratio improving to 2.35x from 2.11xwhile the expense ratio declined 51 basis points to 11.9%the lowest since listing, reflecting improved cost discipline and operating leverage.

Religare Broking said LIC continues to transition from a volume-led insurer to a margin-driven franchise, supported by rising non-PAR contribution, improving ticket sizes, stronger channel diversification and higher digital adoption. The brokerage maintained its positive outlook on LIC, citing long-term growth visibility and rerating potential.