Brokerage firm Emkay has upgraded its rating on the shares of Life Insurance Corporation of India to 'buy' with a target price of ₹760 apiece, a 25% upside from Monday's closing price.

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The state-owned life insurance behemoth reported its second quarter results on Friday with LIC net profit for the quarter coming at ₹7,925 crore against ₹15,952 crore in the year-ago period. The net premium income declined to ₹1,07,397 crore from ₹1,32,631.72 crore in 2022.

"We continue to perceive that structural challenges—such as slower growth-led market-share loss, sticky operating expenses, and higher sensitivity to equity market-led EV volatility—are likely to cloud LIC’s outlook," Emkay noted.

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According to the brokerage, weaker growth, strong equity market-led EV boost and another pension drag.

"Overall, we continue to see LIC’s cost problem and heavy dependency on individual agents limiting its growth, and the gradual market-share loss in the individual business persisting," the brokerage said.

LIC's shareholder lock-in period ended on November 13, freeing up a large chunk of shares for trading. CNBC-TV18 reported earlier this month that over 180 crore shares of 15 companies will become eligible for trading once their respective lock-in periods end. Of those, 85% belong to only two companies — LIC and Mankind Pharma.

LIC went public in May 2022 where the government sold 3.5% equity for over ₹21,000 crore. Shares were sold at ₹949 apiece and the stock has not gone back to its IPO price since then.

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(Edited by : Ajay Vaishnav)