LIC Stock Jumps 2% on 1:1 Bonus Share Approval, May 27

Life Insurance Corporation of India announced its first bonus share issue since listing in 2022. The state-run insurer will issue one free share for every share held, funded by capitalizing ₹6,325 crore from reserves. LIC stock closed at ₹854.90 on May 26, up 2% for the day. Investors must purchase shares by May 27 to qualify for the bonus, as the record date is May 29.

How the Bonus Works and Who Qualifies

LIC will distribute one fully paid equity share of ₹10 for each existing ₹10 share held as of May 29. The bonus uses ₹6,325 crore from the company’s reserves, which totaled ₹1.5 lakh crore as of December 31, 2025. Shareholders must hold shares in their demat accounts on the record date to receive the bonus. Due to India’s T+1 settlement rule, investors must buy by May 27 (Wednesday) to ensure shares credit by May 29, since May 28 is a market holiday for Bakrid.

Why the Bonus Boosts Liquidity and Affordability

The bonus doubles the share count but does not change LIC’s market value. However, it makes shares more affordable for retail investors and improves trading liquidity. The move reflects LIC’s strong financial position. The company reported net profit of ₹23,467 crore for Q4 FY26, up 23% year-on-year from ₹19,039 crore. Net premium income rose 12% to ₹1.65 lakh crore.

First Corporate Action Since 2022 Listing

LIC has issued dividends five times since listing in May 2022, but this is the company’s first bonus share distribution. The board approved the bonus in April 2026. Market participants view the bonus as a sign of management confidence in LIC’s long-term growth and strong reserves position.

What This Means for Investors

With LIC trading at ₹854.90 and the bonus set to double share holdings, investors who buy before May 27 will receive one free share for each purchased share. The stock’s 2% gain reflects positive investor sentiment around the bonus. Shareholders should act quickly, as May 27 is the final trading day to qualify for the May 29 record date.

Final Thoughts

LIC’s 1:1 bonus share issue marks a major corporate action for the state-run insurer. Investors must buy shares by May 27 to qualify. The bonus improves affordability and liquidity without changing LIC’s market value.

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