LIC Shares Jump 5% on First-Ever 1:1 Bonus Issue

Life Insurance Corporation of India shares jumped more than 5% on Wednesday after the state-owned insurer announced its first-ever 1:1 bonus issue, entitling each shareholder to one additional share for every share currently held. The announcement marks a notable event for LIC, which listed on Indian exchanges in 2022 and has not issued bonus shares since. The bonus issue is structured as a capitalisation of reserves, converting accumulated surplus on the balance sheet into paid-up equity capital rather than distributing cash. Subject to regulatory and shareholder approvals, LIC said the new shares will be credited within two months of board approval, with a deadline of June 12, 2026. For existing shareholders, the mechanism doubles their share count while proportionally adjusting the per-share price, leaving total holding value unchanged at issuance. The practical effect is improved stock liquidity through a lower nominal price per share. Investors will now watch for the formal approval timeline and any corresponding guidance on dividend policy, given that a larger share base affects per-share payout calculations going forward.