IPO Update: LIC Likely to Launch $8 Billion IPO on March 11

A public offering of shares by India’s state-run Life Insurance Corporation of India (LIC) is anticipated to open for anchor investors on March 11, according to three sources with firsthand knowledge of the situation. The offering is expected to be the country’s largest ever at $8 billion.

Other investors will be able to bid on the book a few days later, according to the sources.

The LIC IPO is anticipated to receive regulatory approval by the first week of March, after which an indicative marketing price band would be created, according to the sources, who declined to be identified since the deal discussions are confidential.

LIC did not respond to a request for comment. A Reuters request for comment was not immediately returned by a representative for the finance ministry.

The IPO launch schedule may vary, according to the sources, but the issuer is currently working to meet those deadlines.

The country’s largest insurance company, LIC, submitted a draught IPO prospectus with the market regulator on Sunday, aiming to raise about $8 billion by selling 5% of the Indian government’s holding.

LIC could begin offering public shares by mid-March, according to sources who spoke to Reuters last month. They didn’t go into detail.

The government is rushing to complete the IPO by the end of March in order to satisfy its budget deficit target of 6.4 percent of GDP in financial year 2021-22, which depends on the issuance raising roughly Rs 60,000 crore ($8.03 billion).

New Delhi cut its divestment and privatization plans for the fiscal year ending March 31 from Rs 1.75 lakh crore to Rs 78,000 crore.

It has only raised Rs 12,000 crore so far from divesting holdings in state-run enterprises, including refiner Bharat Petroleum Corp Ltd and two banks, which it attempted to privatize.

Investor roadshows for the sale, which is expected to be the world’s third largest insurance IPO at $8 billion, began earlier this week, according to two sources.

The deal’s bookrunning lead managers include SBI Caps, Citigroup, Nomura, JPMorgan, Goldman Sachs, and five additional domestic and foreign investment banks.

According to fund managers and experts, LIC’s imminent initial public offering has hammered shares in other listed Indian insurers as investors decrease their holdings to make place for the state-owned giant.

With over 280 million policies, the 66-year-old firm leads India’s insurance sector. In 2020, the most recent year for which statistics are available, it was the fifth largest worldwide insurer in terms of insurance premium collection.