Insurance cos fish in troubled waters

Buy stocks worth Rs 1,500 cr in last 6 days.

Insurance companies have been aggressive buyers on the stock market since share prices started falling last week. According to conservative estimates, the 30 life and non-life insurance companies bought shares worth over Rs 1,500 crore.

Public sector behemoth Life Insurance Corporation of India (LIC) bought shares worth Rs 900 crore. LIC, which has a strong preference for large-cap Nifty stocks, has bought banking, infrastructure, engineering, construction and capital goods stocks.

On the same lines, ICICI Prudential Life Insurance Company, the largest private sector life insurer, invested Rs 300 crore in the last five days.

The Sensex, which stood at 20827.45 points last Monday, fell to 17605.35 points on Monday, a 15.47 per cent fall in one week. Nifty which closed at 5208.8 points on Monday, was at 6200.10 points last Monday, a 16 per cent fall.

Puneet Nanda, chief investment officer, ICICI Prudential Life, said, "Our investment decision depends primarily on the valuation of specific stocks and sectors. Whenever the valuation is in line with our target, we buy. We are overweight on capital goods, engineering, infrastructure and financial services."

New India Assurance company, the largest non-life insurer has entered the market on Monday by buying Rs 10 crore worth of Associated Cement Companies and National Thermal Power Corporation shares.

Due to festive season, the Chennai-based United India Insurance, which was closed on four working days last week, bought Rs 10 crore of power sector, power equipment and banking stocks last Friday.

On Monday, United India Insurance bought Rs 30 crore of stocks in power sector.

United India invests in mid-cap and large-cap stocks.