Insurance companies step up stock purchases amid market swings

LIC may have also ramped up share purchases to cushion the market against steep falls ahead of its initial public offering, said market watchers

Domestic insurers, led by the Life Insurance Corporation of India (LIC), have stepped up their equity purchases amid relentless selling by foreign portfolio investors (FPIs).

Since November last year, domestic institutional investors (DIIs) have shopped for equities worth Rs 1.53 trillion, of which roughly a third have been bought by insurers. LIC alone accounts for about 70 per cent of the insurers’ flows, according to market watchers. This buying, combined with inflows from mutual funds (MFs), which have pumped in excess of Rs 1 trillion since November, has provided a semblance of stability to the market during periods of volatility. The