If you are a retail investor, then LIC’s investment strategy can become an inspiration for you. Being India’s largest institutional investor, LIC’s steps provide important clues in understanding the mood and direction of the market. Recently, LIC has increased its stake in two big FMCG companies of the country — Tata Consumer Products and Dabur India. According to Exchange Filing, on October 24, LIC has increased its stake in Tata Consumer from 6.633% to 8.645%, i.e. an increase of about 2%. This purchase has been done from the secondary market, not from any new share issue. Shares of Tata Consumer have given 3% returns in the last one month and 18% returns in the last one year — which is a better performance than the market average. At the same time, LIC’s stake in Dabur India has increased from 4.918% to 6.985%. That means an increase of about 2.07% and 3.66 crore additional shares were purchased. However, Dabur has given 1.5% return in the last one month and -8% return in one year. It is clear from these investments that LIC’s focus is on Long-Term, Stable and Defensive Growth Sectors. The FMCG sector maintains stable demand in both recession and boom, which makes it a reliable investment.
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