Life Insurance Corporation of India
ISIN: INE0J1Y01017 • Market Cap: ₹5.22 Lakh Cr
The 5-Pillar Quality Audit for Life Insurance Corporation of India
Evaluated across Profitability, Financial Health, Historical Compounding, Valuation Safety, and Ownership Governance:
1. Profitability & Capital Efficiency
Weight: 25%Measures operating margins (—), Return on Capital Employed (37.8%), and equity compounding (37.7%).
2. Financial Health & Solvency
Weight: 25%Debt-to-Equity is 0.00 with comfortable interest coverage and clean working capital.
3. Growth & Compounding Track Record
Weight: 20%Historical 3Y Sales CAGR (—) and 3Y PAT CAGR (16.9%).
4. Valuation Multiple & Margin of Safety
Weight: 15%Trades at P/E of 8.70 vs PEG of 0.88 and Dividend Yield of 2.4%.
5. Ownership Quality & Governance
Weight: 15%Promoter holding stands at 96.5%, backed by 1.4% institutional ownership.
Key Fundamental Strengths
Superior Capital Efficiency (ROCE: 37.8%)
Life Insurance Corporation of India generates exceptional return on capital employed of 37.8%, reflecting pricing power and competitive moat.
Robust Equity Compounding (ROE: 37.7%)
Shareholder equity compounds at a healthy 37.7%, exceeding average Indian equity benchmarks.
Fortress Balance Sheet (D/E: 0.00)
The company operates virtually debt-free, shielding net margins from interest rate cycles and monetary tightening.
Attractive Valuation Margin (P/E: 8.70)
Trading at a P/E multiple of 8.70, the stock offers a favourable risk-reward entry for quality compounding.
Areas to Watch & Potential Risks
Sectoral & Macro Headwinds (Financial Services)
Subject to broader cyclical demand, raw material price shifts, and regulatory frameworks governing the Financial Services space.
Quantitative Strategy Eligibility
Checking LICI against established Indian wealth creation frameworks:
Coffee Can Investing Framework
Fails 10%+ revenue growth or 15%+ minimum capital return benchmark over historical periods.
Quality Factor Screener (High RoIC + Low Debt)
Qualifies for Indian Quality Indices with overall score of 87/100 and clean gearing.
GARP / Value-Growth Blend
Provides balanced valuation margin with strong profitability scores.
Financial Services Sector Peer Comparison
Compare LICI directly against top industry peers by market capitalization:
| Company | 5-Pillar Score | Market Cap | P/E | ROCE | D/E | Scorecard |
|---|---|---|---|---|---|---|
| Life Insurance Corporation of India (LICI)Current | 87/100 | ₹5.22 Lakh Cr | 8.70 | 37.8% | 0.00 | — |
| HDFC Bank Ltd. (HDFCBANK) | 74/100 | ₹11.10 Lakh Cr | 14.05 | 12.8% | 1.01 | View |
| ICICI Bank Ltd. (ICICIBANK) | 76/100 | ₹10.06 Lakh Cr | 17.94 | 16.5% | 0.62 | View |
| State Bank of India (SBIN) | 71/100 | ₹9.66 Lakh Cr | 11.20 | 12.2% | 1.38 | View |
| Bajaj Finance Ltd. (BAJFINANCE) | 68/100 | ₹6.72 Lakh Cr | 33.07 | 13.9% | 3.86 | View |
| Kotak Mahindra Bank Ltd. (KOTAKBANK) | 68/100 | ₹3.90 Lakh Cr | 19.21 | 12.1% | 0.53 | View |
Frequently Asked Questions: Life Insurance Corporation of India
Q:What is the 5-Pillar Fundamental Score for Life Insurance Corporation of India (LICI)?
Life Insurance Corporation of India has a RupeeTools Fundamental Score of 87/100, placing it in the 'Exceptional Quality' category. Its pillar scores are: Profitability (99/100), Financial Health (99/100), Growth (70/100), Valuation (90/100), and Ownership Quality (65/100).
Q:Is LICI fundamentally strong for long-term investment?
Yes, LICI exhibits solid fundamental strength with a 87/100 score, driven by a return on equity of 37.7% and a debt-to-equity ratio of 0.00.
Q:Does LICI pass the Coffee Can Investing filter?
No. LICI does not currently meet the strict 15% ROCE and 10% sustained topline compounding threshold mandated by the Coffee Can investing framework.
Q:How does LICI compare against other Financial Services peers?
Within India's Financial Services sector, LICI trades at a P/E of 8.70 and generates an ROCE of 37.8%. Compare its 5-Pillar score of 87/100 against top sector peers like HDFC Bank Ltd. (74/100), ICICI Bank Ltd. (76/100).
Regulatory & SEBI Research Analyst Compliance Disclaimer:
This 5-pillar fundamental score is an automated quantitative health check generated purely from historical public financial statements, corporate filings, and exchange disclosures for educational and informational purposes only. It does NOT constitute investment advice, a stock recommendation, or a solicitation to buy or sell securities. RupeeTools is not a SEBI-registered Research Analyst. Please consult a SEBI-registered financial advisor before making investment decisions.