Shares of Life Insurance Corporation of India (LIC) surrendered most of its gains and ended flat on Wednesday after its disastrous debut on Tuesday.

Analysts are, however, advising investors to hold on to the stock as they may be rewarded over the long-term through dividends given LIC’s reach, size and scale and the under-penetrated nature of India’s insurance industry.

On Wednesday, the LIC share opened at a higher note of Rs 886.20 on the BSE over the previous close of Rs 875.45 and rose almost 2 per cent to touch a high of Rs 890 during intra-day trades. However, the counter gave up these gains and settled at Rs 876.25.

On the NSE, the share ended at Rs 874.75 — a drop of 50 paise over its last close of Rs 875.25 after hitting a day’s high of Rs 891. At close, its market capitalisation on the BSE stood at Rs 5,54,227.92 crore.

The lacklustre showing for the second consecutive trading session comes after a poor debut. Its policyholders and retail investors, who were issued shares at a discounted rate of Rs 889 per share and Rs 905 per share, respectively, did not find any comfort when the scrip closed below these prices.

Analysts feel that LIC may also see higher margins as it increases its focus on non-participating (non-par products which do not allow policyholders to participate in profits of the company) in the coming years.

It is expected that the corporation may launch more products like term insurance, ULIP, pension or annuity products on this front.

Meanwhile, the initial public offer of Paradeep Phosphates got subscribed 51 per cent on the second day of subscription on Wednesday.