Shares of Life Insurance Corporation of India (LIC) extended gains for the third straight session on Tuesday, rising 1.94 per cent to Rs 853.40 at last check. The stock has climbed 6.65 per cent in three trading sessions.

The rally in LIC shares comes after the insurer emerged as the highest profit-making company in India's financial sector for the March 2026 quarter (Q4 FY26), according to ACE Equity data.

Strong Q4 performance

JM Financial said LIC delivered a strong operational performance during Q4 FY26, supported by healthy premium growth and improved margins.

"LIC reported strong results for Q4 FY26 – individual APE (Annualised Premium Equivalent) grew by 16 per cent, higher than reported RWRP (Retail Weighted Received Premium) growth of 13 per cent, and group APE rose by 37 per cent. Thus, total APE grew by 22 per cent. VNB (Value of New Business) margin of 21.2 per cent in FY26 implies a very strong 24.9 per cent margin in Q4," the brokerage noted.

It added that margin expanded by 360 basis points (bps) year-on-year (YoY) in FY26, aided by gains from product mix and improved economic assumptions.

JM Financial retained its 'Buy' rating on LIC and raised its 12-month target price to Rs 960 from Rs 888 earlier.

"With a higher negative economic variance, EV at Rs 7.9 lakh crore (+2 per cent YoY) missed JMFe by 2 per cent and was below Sep'24 and Sep'25 levels. We raise our FY27/FY28E VNB estimates by 15 per cent+, with steady 10–12 per cent growth and improving margin (22 per cent by FY28E)," the brokerage said.

Meanwhile, HDFC Securities upgraded LIC shares to a 'Buy' rating while maintaining its target price at Rs 1,110.

Bonus issue, dividend in focus

Investor sentiment has also been supported by LIC's upcoming bonus share issue.

In a regulatory filing, LIC said its board approved the issuance of bonus equity shares in the ratio of 1:1 by capitalising Rs 6,325 crore from reserves and surplus available as of December 31, 2025.

"...it is hereby informed that the Board of Directors of Life Insurance Corporation of India, at its meeting held on Monday, April 13, 2026, considered and approved the issuance of bonus equity shares in the ratio of 1:1," LIC said in the filing.

The insurer has fixed May 29, 2026, as both the ex-date and record date for determining shareholders eligible for the bonus shares.

LIC has also recommended a final dividend of Rs 10 per equity share of face value Rs 10 each for FY26, subject to shareholder approval. The company has fixed June 25, 2026, as the record date for the dividend payout.

Last date to buy LIC shares for bonus eligibility

Investors looking to become eligible for the bonus issue must purchase LIC shares before the record date in line with Sebi's T+1 settlement cycle.

Since stock markets will remain closed on May 28 on account of Bakri Id, May 27 (Wednesday) will be the last trading day to buy LIC shares for bonus eligibility. Shares purchased on or before that date will be credited to investors' demat accounts by the May 29 record date.