Insurance shares surge on hopes of hike in FDI cap

Shares of companies engaged in the insurance business such as Aditya Birla Nuvo, Max India and Reliance Capital on Thursday surged as much as 5% on hopes that the government will accelerate pace of economic reforms by raising FDI cap in the sector.

Aditya Birla Nuvo gained 5% to Rs 955, while Max India jumped 4.8% to Rs. 244.50 on the BSE. Among others, shares of Reliance Capital rose by 4%, while Bajaj Finserv was up 3.45%.

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Unfazed by the uproar over decision on FDI in retail, the government is determined to give a push to reforms, with the Union Cabinet set to consider today big-ticket measures like opening pension sector to foreign investment and raising FDI cap in insurance sector to 49%.

The Insurance Laws (Amendment) Bill seeks to raise the FDI cap in insurance sector to 49% from the 26% at present.

In the broader market, the BSE 30-stock index, Sensex, was trading at 19,049.27, up 179.58 points at 1133 hrs.

PTI