Key Takeaways
- LIC Wins RBI Approval to Raise HDFC Bank Stake to 9.99%
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- The insurer currently holds a 4.11% stake in HDFC Bank.
- The approval allows LIC to acquire another 5.88 percentage points.
Life Insurance Corporation of India (LIC) has received approval from the Reserve Bank of India (RBI) to increase its stake in HDFC Bank to as much as 9.99%. The approval allows LIC to raise its existing 4.11% holding by up to 5.88 percentage points, giving the insurer scope to become a larger shareholder in India’s largest private sector bank.
LIC wins RBI approval by increasing HDFC Bank holding
According to HDFC Bank’s regulatory filing, theLIC wins RBI approval to acquire an aggregate holding of up to 9.99% of the bank’s paid-up share capital or voting rights. LIC’s latest reported holding stood at 4.11% as of August 14, 2026.
The approval gives LIC the option to acquire an additional 5.88% stake in HDFC Bank. The insurer’s final holding will depend on the extent to which it uses the approval. The RBI approval was dated August 19, 2026.
The development adds to LIC’s existing exposure to the banking sector through its investment portfolio. HDFC Bank remains one of India’s largest private lenders by market value and has a broad presence across retail, corporate, and commercial banking.
HDFC Bank reported a net profit of Rs 19,060 crore for the April to June quarter of FY27, compared with Rs 18,155 crore in the same period a year earlier. Profit increased 5% year on year during the quarter.
The bank’s net interest income also increased during the period. NII stood at Rs 33,534 crore in Q1 FY27, compared with Rs 31,438 crore in the year ago quarter, representing a 7% year on year increase.
HDFC Bank and LIC shares track recent declines
The RBI approval comes as both HDFC Bank and LIC shares have recorded declines over recent months.
HDFC Bank shares closed at Rs 720 on the NSE on August 19, unchanged from the previous session. The stock has declined 6% over the past 1 month and nearly 21% over the past 6 months.
LIC shares also ended flat at Rs 413 on the NSE on August 19. The insurer’s stock has declined nearly 5% over the past 1 month and more than 4% over the past 6 months.
For investors and businesses tracking India’s financial sector, the approval marks a potential increase in LIC’s exposure to HDFC Bank. LIC can now decide whether to increase its holding from the current 4.11% toward the approved ceiling of 9.99%, subject to the applicable requirements for the acquisition.
