LIC IPO To Open For Anchor Investors Today | Check Details Here

LIC IPO: The price band of for the listing is fixed at Rs 902-Rs 949 per equity share; Govt to divest 3.5 per cent stake in the insurer

The government is eyeing to raise around Rs 21,000 crore from LIC IPO. Image: Getty

Source : Getty

New Delhi: The mega initial public offering (IPO) of Life Insurance Corporation of India (LIC) will open for anchor investors on Monday. However, for the general investors, the issue will open on May 4 (Wednesday) and will continue till May 9 (Monday).

The central government is offloading 3.5 per cent stake in the insurer by selling 22.13 crore shares.

The Centre is eyeing to raise around Rs 21,000 crore. However, the amount is quite lower than the earlier projection of Rs 60,000 crore.

The price band of for the listing is fixed at Rs 902-Rs 949 per equity share.

The state-run insurance behemoth will be listed on the stock exchanges on May 17.

According to news reports, about 50 per cent of the offer is reserved for qualified institutional placements (QIPs), including anchor investors. For retail investors, 35 per cent is reserved, while 15 per cent is reserved for high net worth individuals. The retail investors and eligible employees will get a discount of Rs 45 per equity share and policyholders will get a discount of Rs 60 per equity share.

Here are some key points on the IPO:

• After the IPO, LIC will be run by a professional board with nine independent directors who have been already inducted. Managing Director Siddhartha Mohanty said the post of chairman will be in place till 2024 and after that it will replaced by MD and CEO
• LIC, which is the largest market leader in the life insurance sector in the country, has Rs 40 lakh crore as assets under management (AUM) and reserves of Rs 30 lakh crore.
• The company’s embedded value, or measure of consolidated shareholders value in an insurance firm, was estimated at Rs 5.4 lakh crore in September. The evaluation was done by international actuarial firm Milliman Advisors.

• LIC Chairman M R Kumar has said that its IPO pricing is attractive and investors can look for returns for a long time to come.

• The LIC IPO is expected to provide a major contribution to the government's disinvestment proceeds in this fiscal year (FY22). The Centre had pegged disinvestment receipts at Rs 65,000 crore, up from Rs 13,531 crore raised in the last fiscal year.
• The government earlier had announced an IPO size of 5 per cent for the LIC listing, however, it was later trimmed to 3.5 per cent last month due to volatile market conditions.
• The IPO, which was supposed to be launched in the last fiscal year, was postponed due to ongoing Ukraine-Russia war, volatile market conditions, and high rates of inflations.