Life Insurance Corporation (LIC) stock made a tepid listing at the bourses in May. Since then, the stock of India's biggest life insurer has been unable to come up to the IPO price of Rs 949. Emkay Global Financial Services, a leading domestic brokerage has initiated coverage on the stock with a 'hold' rating with a target price of Rs 875 – up around 8 per cent from the current levels.
The brokerage, however, feels LIC is an 'elephant that can’t dance' and lists key reasons for its belief. “While we appreciate LIC’s market-leading position and comfortable valuations, we prefer private sector peers that have better growth, profitability and therefore higher return on Embedded Value (RoEV) prospects,” wrote Avinash Singh