Life insurance major Life Insurance Corporation (LIC) today said it will be keen on buying the long term bonds announced by the Government to be issued under its borrowing programme.
"It is a very positive announcement from the government that long duration papers will be issued. Definitely, there will be good demand for these papers especially from life insurance cos and I am sure that LIC will take advantage from them," LIC Chairman S K Roy told reporters on the sidelines of a financial inclusion summit.
Roy said that since life insurance companies have long term liabilities in the form of policy contracts, such long term bonds would be good bet.
"This (announcement of long term paper) will encourage us to go in for the G-Sec market. But that does not mean that we will not be investing in corporate bonds or corporate debt or equity. It is all about taking advantage of the opportunities available," he said.
Talking about investment in the equity as well as bond market in this fiscal, Roy said the Corporation has surpassed the last year's figure.
"Even the profit that we have made from the equity transactions is more than last year," he said adding that the investment target for the next financial year is yet to be decided.
On LIC's plan to increase its stake in PSU banks, he said investment in PSU banks is governed by the threshold specified by IRDA and it would not be breached.
He further said that LIC has applied for a few ULIP products and will likely launch it next year.