Business

LIC’s IPO filed with market regulator, expected to sell 5% equity stake

February 13, 2022
Bharat Times

Govt files draft prospectus for LIC’s IPO with SEBI

The government on Sunday filed draft documents with market regulator Securities and Exchange Board of India (Sebi) for the initial public offering (IPO) of Life Insurance Corporation of India (LIC), through which it is expected to sell 5 per cent equity stake.

According to sources, the public offer is expected to hit the capital markets in March.

According to the draft Red Herring Prospectus (DRHP) filed with the market regulator, the government will sell over 31 crore equity shares of LIC.

Tuhin Kanta Pandey, Secretary, Department of Investment and Public Asset Management (DIPAM), tweeted, “DRHP of LIC’s IPO has been filed with SEBI today.”

The government aims to IPO and list Life Insurance Corporation (LIC) on stock exchanges by March.

A portion of the IPO will be reserved for anchor investors. Also, up to 10 percent of the LIC IPO issue size will be reserved for policyholders. Actuarial firm Milliman Advisors LLP India acted on LIC’s embedded value, while Deloitte and SBI Caps were appointed pre-IPO transaction advisors.

The IPO is seen as a test of investors’ appetite for new offerings, with many companies that listed last year now trading below their offer prices on concerns over higher valuations and fighting inflationary pressures. Interest rates have been increased by global central banks, Reuters reported.

The listing also comes against the backdrop of foreign investors pulling out funds from the domestic market as the government seeks to meet the sharply trimmed disinvestment target for the current fiscal.

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