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LIC IPO Complete Details | Review of #LIC IPO Investment | Apply or Avoid #LICIPO | Share Market - YouTube
Channel: Pushkar Raj Thakur: Business Coach
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Till now you must have heard the praise of
LIC a lot.
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People are saying very loudly that we will
invest money in LIC and you people should
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also invest money in LIC.
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But did someone tell you that LIC might not
grow so much in the coming time?
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LIC will make a profit, it will make money
but it will not grow, and now I am saying
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this, maybe, you may not even understand because
if everyone is praising then it has become
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a slightly different statement.
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This turned out to be a slightly controversial
statement which I am saying, but I will tell
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you why I am saying this.
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Well, on today's date, everyone knows about
LIC, the policyholders of LIC are in every
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part of India.
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Now, when we talk about, Even with life, even
afterlife, this famous tagline is, which has
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entered your mind.
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LIC has entered it in your mind and it creates
the biggest thing, which is trust.
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But the thing I am telling you is that despite
this trust, I am guessing that LIC will not
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grow in the upcoming time, It will make a
profit.
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So I will explain to you in detail but before
that let's know about its history.
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See, you know that LIC is government-owned
till now, which means the government has total
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control over it, it is government-owned and
it creates trust that LIC belongs to the government
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then our money is secure and we will get money
but at the beginning of LIC was in 1956, the
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government passed an act in parliament that
they will make LIC on 19th June and LIC, Life
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Insurance Corporation of India, formed in
the first of September 1956.
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Today, the market share of LIC in terms of
the premium collection is 64.1% and LIC people
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claim that we are the biggest market leader.
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We are the King, it's great.
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But why do they say it because they are on
number first?
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Then SBI Life comes on number two, whose market
share is 7.83%, which means there is a big
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difference between 64% and 7.83%.
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HDFC comes after it and if we talk about HDFC
life insurance, then they have a market share
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of 7.63% in the premium collection, and then
Max Life has 3.4% followed by Bajaj 2.1% and
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the rest which are private players.
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As of today's date, more than 20 private companies,
which are offering life insurance, are far
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behind if we compare.
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But I will tell you one more thing on which
you did not focus.
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In 2014, the market share of LIC was 75%,
which by 2022, we are considering 64% big,
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but we don't see it going down from 75% to
64% and why it happened.
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We'll talk about it but you want to know some
details.
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As of today, LIC has two lakh employees and
more than two lakh employees are working for lic
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Whether it is a good thing or a bad thing,
we will discuss it.
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There are fifteen lakh agents, that is good,
there is nothing bad in that.
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Fifteen lakh is a huge number.
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They are bringing business for LIC, I find
their model is very unique.
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They have adopted their model on today's date,
it was not done today, It has been going on
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for many years and they have captured the
market very well for many years.
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But in the coming time, we will tell you what
will happen.
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There are more than 30 crore policies and
this is the biggest treasure of LIC.
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Why is it so big and why I am giving importance
to it, we will talk about it.
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And in today's date,
The company has filed a red herring prospectus
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which is called DRHP and it has not disclosed
its valuation in it.
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But people have put an estimate according
to the industry that according to the valuation
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of about 15 lakh crores, the company is asking
for money.
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In the IPO, if we talk about LIC, it is diluting
its 5% stake.
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Till now the government has 100% stakes, 5%
means 31.6 crore shares, which means the company
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is issuing 31.6 crores shares in the IPO,
now the good thing is that there will be a
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reservation of 10% for policyholders and employees
of the company.
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And it is important to know, that you are
investing for the long term that whether the
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company will grow or not, then we understand
that too because my focus is to give you a
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deep understanding, you had to know a small
thing whether to apply or not, then all the
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people who are in the house, open their demat
account and there is a link in the description
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and the comment box.
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You can go and get the demat account opened
today and the second thing is that the policyholders
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are getting benefits separately because there
is a 10% reservation there.
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There is a 10% reservation for the policyholders
and employees, so there are more chances of
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allotment in IPO because not everyone gets
IPO.
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So you have this plus point or if you have
LIC policy, then you definitely get to open
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your demat account, if you want then we can
also make a special video, on which I will
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tell you how policyholders will get benefit
and second thing, what you will have to do for that
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So if you want us to make a video for that,
then you can comment.
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Now the company is asking for 63 thousand
crores for the 5% stakes, for 31.6 crores
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shares, the company wants to raise 63 thousand
crores.
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There has not been a bigger IPO than this
in the history of India and after this IPO,
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the valuation of the company is almost equal
to Reliance, so if we talk about the company
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in India, by diluting its 5 percent stakes,
you will see that it has a top player in the
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market and it came on top.
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Because before, Paytm had an IPO in 2021,
which I told you about and didn't invest money
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in, it raised 18300 crores in the IPO.
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There was an IPO in 2010 of coal India of
15500 crores and before that Reliance Power
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IPO came of 11700 crores but now see 63 thousand
crores.
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By the way, LIC is a gold bird for the Government
of India because it is continuously making money
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Now we talk about, you know, all this data
that was needed.
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The IPO is going to come in March and the
dates will also come out, then you can apply.
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I told you that if you open a demat account
then you will benefit.
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Now let's talk about what I wanted to do.
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Why is there no growth for the company?
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Earlier private players could not enter inside
India.
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But right now the government is giving a lot
of liberty that private players can enter.
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You will check one thing, the same Insurance,
suppose you want term insurance of two crore
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rupees, so if you want to take term insurance
of two crores, then you compare that to how
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much premium LIC is charging.
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There is not only trust in LIC but there is
also trust in Tata and there is also trust
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in Bajaj.
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So if Tata is offering you a policy then suppose
you take life insurance from a private company.
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I had taken an example of Tata, so you compare
with private companies how much premium they
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are charging from you and you will be surprised
to see that LIC charges more premium from you.
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Still, LIC is charging more premium, but now
people are saying that there is trust in other
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companies also, it is not like.
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All the insurance companies are there, all
are regulated and they are also regulated
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by the government bodies, so it is not that
anyone will run away with your money.
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When you pay a premium to a company, the company
also has to keep it in reserve so that if
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you go to take the claim, then you get that
claim.
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It is not like the claim settlement ratio
of LIC is very good.
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The claim settlement ratio of LIC is from
96-97% and if you look at the private company
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then it is also good and some companies are
offering better than that.
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So now talk about that if I had to take term
insurance of two crores then I am paying more
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money in LIC and I am paying less money to
private player's.
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many such features are available in LIC, which
private companies are offering as of today's date
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So when we talk about the competition, The
people of LIC will say that they are not afraid
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of competition and I am not talking about
agents in LIC.
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I am talking about those who are working in
LIC, but competition is fair as their market
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share in the market is continuously decreasing.
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I had given you an example that if we take
only one data, then we talk about from 2014
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to 2022, then their market share has been
decreased, and in the coming time, if the
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company will continuously charge more premium
in the coming time and it will not better
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it's servicing and it will not bring some
new product innovations, then the new players
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in the market will go on taking market share
because you can compare it to today's date.
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We cannot compare the insurance with the bank
but the banking service.
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You will also have multiple bank accounts.
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Maybe you have money in the public bank accounts
and also in private bank accounts then whose
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service do you think is better?
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You will say that private services are better
and today the government does not make any bank sink
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It does not allow the Yes Bank to sink, so
it is not allowed to sink, and it comes to
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save, so it is not that if you are taking
insurance with a private company and if the
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company sinks then your money will become
zero, it doesn't happen generally.
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So now the thing is, the biggest thing is
collecting more premium and if it is collecting
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more premium and if people continue to think
that LIC's insurance is expensive.
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And if you say that people will continue to
buy it in the name of trust then it is not
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Now the second thing is why they have too
many sales and why they have big numbers,
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for that agent come in.
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Agents have a role in it, these fifteen lakh
agents, they are agents of LIC in today's
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date but you ask any agent of LIC, that can
you get me insurance for any other company
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then he will say yes, he will say tell for
which company you want, then they are not
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trustworthy for LIC, these fifteen lakh agents
are selling the insurance of more private
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companies in today's date and you know that
LIC sells the life insurance then health insurance
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will have to be bought by some other company,
in which private players are far ahead, I
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mean to say that these people want money.
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From where they will get good money, they
will sell its product.
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The fun in LIC is that if someone calls for
the policy of LIC, then it is an intoxication
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for the LIC agent, and I explain to you.
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Straight away they are getting money, if they
sell a policy for 30-35% then they are getting
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If someone gives a premium of one lakh then
I am telling you if will understand it that
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30-35% means 30000 to 35000, he is getting
it straight away and As long as that person
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keeps paying a premium, means every year or
every month then 5% on that premium goes to
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the agent and this is the model of LIC then
straight away LIC is paying the very big amount
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and it is giving 5% continuously then It is
an addiction for people.
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People think that once we become agents of
LIC and if we did 100-200-500 policies then
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we will sit and eat for life because whoever
has taken LIC policy, I told you that the
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treasury for LIC is 30 crore policies, suppose
my policy is going on, then will I get the
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policy closed.
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I am paying for the policy for 5 years, so
will I not continue for the coming time?
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People continue and because people continue,
everyone continues after taking any policy of lic
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Now it is a government body then the money
is going to the government and the agent's
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commission is also going from it, so the agent
has a regular income and the government has
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regular income.
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But now what will happen in the coming time
because the penetration inside insurance is
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not too much.
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They say this, If we look according to the
development of the country, then around 7%
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of the GDP should come from the insurance
sector, which is not even around yet in India,
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so we are far behind in the penetration, and
scope is left.
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Then you understand that LIC will capture
the market in the coming time, think by yourself,
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it can do it if it reduces its premium a little
and it makes the product more innovative.
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Now let's understand one more thing, the money
coming on LIC, all people just don't think
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that now you think that the insurance money
that comes to the company, what it does with
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it, will put it in the market.
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LIC is such a big investor that it has invested
so much money in the share market, that LIC
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has become an index fund in itself.
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Now we talked about index funds.
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Index funds are those which move according
to the market, so if the market goes up then
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there is profit and if it falls then there
is loss.
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LIC has invested so much money in the market
because when the money is coming in, it will
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only invest, then it cannot give you more
returns than the market, so now you understand
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that the company will continue to earn money
and how it will earn because the company has
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policies.
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Premium will keep coming and it will keep
investing in the market and the company will
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continue to make a profit, so I told you in
the beginning that LIC's is going to earn
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a regular profit, LIC has lots of assets and
regular income will keep coming from it.
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But growth is a big question because if that's
the way LIC is going, If we look at the previous
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data, which I told you earlier that it is
losing its Market share from 2014 to 2022
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and in the coming time I think that it will
lose, but now people want to know only one
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thing that IPO is coming, whether to invest
money or not, what will happen in future.
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What does it matter in an IPO?
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Hype matters in IPO, hype is too much.
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If people feel that the company is asking
for money according to
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the valuation, then definitely you will see
the share growth in the coming time and maybe
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the company does not reveal actual valuation
in the DRHP, so if the valuation is high and
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the company is asking for money according
to the less valuation, then there are chances
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of the share price going up.
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Another thing is that profit will come to
talk about the short term for some time, then
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the IPO of LIC will give you profit.
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But we are talking about a long term like
5 years and 10 years and 15 years, because
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once the shares are listed, after that it
matters what is the future of the company,
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so the price you see in the share market
of any Share, it is a good indicator to analyze
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that what company is going to do in the coming
time, if it is going to do very good in the
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future then you will see share price going
up, and If it looks likes in the future that
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it is not performing very well then the share
can also fall, then, for now, to invest
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money in the IPO you can invest and I feel
that you will benefit in the IPO but as more
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information comes to us, we can make the video
again on the LIC, When the IPO is about to
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come on LIC, then if you want us to make videos
again you comment.
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On that too we will make a video, I tried
to give you a fair opinion.
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How did you like this video?
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Again you can tell in the comments.
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You can share this video because many people
will get a lot of information from the one
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video, so share this video with your friends
and
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on social media.
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Like this video to give your love, if you
are watching it on Facebook then follow us
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and if you are watching it on YouTube then
subscribe and click on the Bell icon.
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If you have not demat account till now, open
it now, there is a link in the description
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and comment box, because, without demat
account, you cannot apply for IPO.
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And the advantage of opening multiple demat
accounts is that if you have a demat account
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from your name father's name or mother's name
or wife' or sister or brothers name, then
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you can apply for IPO with multiple demat
accounts so your chances will increase, and
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if you are policyholder then we will try to
bring video for you very fast if you will
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write in the comments.
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So will see you in the next video till the
time you open your demat account today and
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go self-made
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