LIC’s IPO: SEBI green signals plan; govt may collect Rs.65,000 cr
Virendra Pandit
New Delhi: With the stock market regulator Securities and Exchange Board of India (SEBI) giving a green signal on Tuesday to the state-owned Life Insurance Corporation’s proposed Initial Public Offering (IPO), the Government of India is expected to earn Rs.65,000 crore through this disinvestment.
The mega-IPO is slated to be the biggest ever in India’s capital market history.
Through the IPO, the Centre is looking to sell over 31 crore shares and mobilize at least Rs. 65,000 crore.
The Government of India holds a 100 percent stake in LIC, with 632.49 crore shares at a face value of Rs. 10 each. It plans to shed a 5 percent stake through this offering.
The LIC had filed on February 13 the 600-page Draft Red Herring Prospectus (DRHP) on which the SEBI issued on Tuesday its final observation letter with minor comments, the media reported.
With the SEBI approval, the Centre can now decide the timing and pricing of the IPO.
As of now, there is no indication as to when the LIC will launch the IPO. The government may weigh in the implications of the volatile market conditions because of the ongoing Russia-Ukraine war before taking a call on the timing. The current market condition is unstable also because of the rising prices of crude, and investors’ concerns about the global economy.
If the IPO goes through and shares are listed, LIC’s market capitalization could match the high-value parallels of the top companies like Reliance Industries Ltd and Tata Consultancy Services.
