IPO Update: LIC Policyholders are Not Eligible to Apply for Discounted IPO Shares, Check Details

The Life Insurance Corporation of India (LIC) has Filed a prospectus with the Securities and Exchange Board of India (SEBI) in preparation for its much-anticipated first public offering (IPO). The LIC DRHP states that up to 10% of the total shares offered via the IPO will be allocated for LIC policyholders. Policyholders and workers will also benefit from a discount.

As a result, many policyholders may be interested in applying for an IPO allotment. However, Policyholder Reservation Portion would not be available to all LIC policyholders.

According to the LIC DRHP’s FAQs, below LIC policyholders are not eligible to apply for the LIC IPO under the Policyholder Reservation Portion.

• You cannot apply for the Offer if you have a joint demat account in the names of your spouse and yourself (where you have two distinct policies and your PAN is connected therein). Individual applications from both demat account beneficiaries are not permitted under SEBI ICDR Regulations. Only the first/primary beneficiary’s name can be used to submit an application. To submit an application, only the first/primary beneficiary’s name can be utilized.
• The spouse of a currently receiving annuity policyholder (now deceased) is not entitled to apply for the LIC’s equity shares in the offer.
• A policyholder must have his or her own demat account. A policyholder cannot apply using his or her spouse’s, son’s, or relative’s demat account.
• NRIs are not eligible to participate in the IPO through the Policyholder Reservation Portion. Only people who are residing in India throughout the bid or offer period are eligible to apply.
• A nominee named in a Corporation policy is not entitled to bid for the Equity Shares in his name. Under the Policyholder Reservation Portion, only the Eligible Policyholder(s) are eligible to bid.
• Except for group policies, all policies are eligible for Bidding in the Policyholder Reservation Portion.
• Under the Policyholder Reservation Portion, only LIC policyholders are eligible to bid. However, as a RIB or Non-Institutional Bidder, one can apply.

Source: The Economic Times