LIC’s IPO on March 11 and the Centre’s sale of a 5 percent stake in the company.According to the news agency Reuters, the Life Insurance Corporation of India (LIC) is expected to begin on March 11 for anchor investors and close on March 30.
According to the agency, the Initial Public Offering (IPO) of the country’s largest insurer is expected to open for investors a few days after the agency’s publication. The issue is expected to be the largest in the country. Paytm, with a $2.5 billion public offering, currently holds the record for the most extensive public offering in India.
A Reuters report claims that regulators will approve the public offering as soon as the first week of March this year. Following that, more details, such as the price range of the equity shares, will be revealed.
The Indian Life Insurance Corporation (LIC) recently filed a draught red herring prospectus (DRHP) with the Securities and Exchange Board of India (SEBI). As stated in the DRHP, the Centre, which owns a 100 percent stake in LIC, intends to sell approximately 316,249,885 equity shares in the company. The shares represent 5% of the company’s total equity value.
Furthermore, the initial public offering (IPO) of the Life Insurance Corporation of India will be strictly a sale of shares. According to reports, the face value of the LIC shares will be Rs 10 per share.
The public offering of LIC is critical to the Union government’s disinvestment goals for the current fiscal year, which ends in March 2022. The sale of the government’s stake in public sector financial institutions and banks helped the government achieve its ambitious disinvestment target of Rs 78,000 crore in record time.
The privatization of Air India and the sale of stakes in other public sector enterprises have raised approximately Rs 12,000 crore. The government set the disinvestment target of Rs 1.78 lakh crore earlier this year.
According to the Insurance Information Institute, LIC is the fifth largest global insurer and the tenth-largest worldwide in terms of total assets. The company continues to be the largest asset manager in the country. LIC had made a profit after tax of Rs 1437 crore in the first six months of 2012-13.
There have been some new developments regarding the Life Insurance Corporation of India (LIC). As a result of its Initial Public Offering, the government is expected to sell five percent of its stake in the company (IPO).
According to the draught red herring prospectus (DRHP) of the public issue filed with the Securities and Exchange Board of India (SEBI), the government will sell 316,249,885 equity shares of the Life Insurance Corporation of India. The issue will consist solely of an offer for sale.
For filing valuation, approximately 31.6 billion shares are being offered, representing 5% of the equity.
By reports, the equity shares of the insurance company will have a face value of Rs 10 each.
A Business Today article states that many experts believe that LIC’s public offering will fetch approximately three times its embedded value in the market news. When we talk about embedded importance, we’re talking about the total sum of net worth, including the capital and the present value of all future profits from the company’s current operations.
According to a report published by LiveMint, the initial public offering (IPO) is expected to fetch up to Rs 71,000 crore in calculated embedded value. On September 30, 2021, the embedded value of LIC was approximately Rs 5.4 lakh crore.
The public offering of the country’s largest insurer is critical to achieving the government’s disinvestment objectives. The Union government expects to raise Rs 1.75 lakh crore this fiscal year from the sale of its holdings in public sector enterprises and financial institutions, according to the Reserve Bank of India.
The Center has raised approximately Rs 12,000 crore so far through the sale of stakes in other state-owned enterprises and the privatization of the national carrier Air India.
The initial public offering (IPO) of LIC is expected to be the largest in the country to date. Publication of LIC shares on the stock exchanges and their initial public offering (IPO) is scheduled next month.
It will be managed by a group of companies including JP Morgan India Private Limited, JM Financial Private Limited, Axis Capital Private Limited, Goldman Sachs (India) Securities Pvt Ltd, Nomura Financial Advisory and Securities (India) Pvt Ltd, and SBI Capital Market Ltd.
According to the company, LIC had managed to make a profit after tax of Rs 1,437 crore in the first six months of the financial year 2021-22. It is the largest asset manager in the country. It is ranked tenth globally in terms of total assets under management.