New Delhi: LIC had last week filed Draft Red Herring Prospectus (DRHP) with capital market regulator Sebi for the sale of 5 per cent stake by the government for an estimated Rs 63,000 crore.
As per recent media reports, the LIC IPO is expected to open on March 10. Touted to be the country's biggest ever public offering, the IPO of over 31.6 crore shares or 5 percent government stake is likely to be up for offer. Reports further add that the IPO, which opens on March 10, will continue for subscription till March 14. (Also read: Can lapsed policy holders apply for the IPO? Know here)
There are currently 24 life insurance companies in India, with LIC being the sole public player. (Also read:)
Here are 10 important things related to LIC's IPO:
The IPO is offer for sale (OFS) by the Government of India and no fresh issue of shares by Life Insurance Corporation (LIC).
The face value of shares is Rs 10 apiece.
Policy-holders along with employees of LIC will also have a quota reserved in the IPO.
Employees and policy holders of the insurance behemoth would get a discount over the floor price.
The LIC IPO would be the biggest IPO in the history of Indian stock market and once listed LIC's market valuation would be comparable to top companies like RIL and TCS.
The current fiscal FY22's divestment target was revised to Rs 78,000 crore from the Budget estimates of Rs 1.75 lakh crore and the Centre would like to cash in the LIC IPO to meet its revised divestment estimate.
The IPO drive will have a 50 percent reservation for Qualified Institutional Buyers (QIB), not 15 percent for Non-Institutional Investors (NII), and 35 percent reserved for retail investors.
The embedded value of LIC, as on September 2021, was Rs 5.4 trillion, DIPAM said in a Twitter post.
The government has appointed 10 merchant bankers, including Kotak Mahindra Capital, Goldman Sachs (India) Securities Pvt Ltd, Citigroup Global Markets India Pvt Ltd and Nomura Financial Advisory and Securities (India) Pvt Ltd, to manage the mega IPO of the country's largest insurer.
Although the DRHP does not disclose the market valuation of LIC, as per industry standards it would about 3 times the embedded value or around Rs 16 lakh crore.
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