LIC IPO Date, Discount, Price for Policyholders, Check Details 

LIC’s IPO is likely to be delayed till mid-April, according to a Reuters report. The initial public offering (IPO), which is expected to be the country’s largest ever initial share sale, was originally scheduled to begin in March. However, Russia’s invasion of Ukraine has derailed the plans, as stock markets are currently extremely volatile.

LIC IPO Date

• “LIC would now most likely be listed by mid-April,” Reuters reported, citing a senior government official.
• “We are closely monitoring market conditions,” the official said, noting that stock markets may have stabilized following the Russian invasion of Ukraine in late February.
• “The government is also keeping an eye on the VIX (volatility index) and wants it to be around 15% for a week before launching the LIC IPO,” said a second government source.
• Another senior government official stated that the government would also wait to see the impact of the expected monetary tightening by the US Federal Reserve, which could harm Indian stock markets and drive away foreign investors, according to the Reuters report.
• The Federal Reserve is widely expected to raise interest rates by a quarter-point at the end of its two-day policy meeting on Wednesday.
• According to the draught papers for LIC’s initial public offering, the government has until May 12 of this year. If the government delays until after May 12, new draught papers must be submitted.

LIC IPO Discount, Price

• Employees and policyholders of the insurance behemoth would receive a discount off the starting price.
• According to regulations, up to 5% of the issue size can be reserved for employees and 10% for policyholders.
• The IPO is an offer for sale (OFS) by the Government of India, and LIC will not issue new shares. The government owns 100% of LIC, or over 632.49 crore shares. Shares have a face value of Rs 10 each.

LIC IPO Size Details

• Life Insurance Corporation (LIC) filed draught papers with capital market regulator Sebi on February 13 for the sale of a 5% stake in the government for an estimated Rs 63,000 crore, paving the way for the country’s largest-ever public offering.
• Sebi approved the Draft Red Herring Prospectus (DRHP) earlier this month.
• Milliman Advisors, an international actuarial firm, has estimated LIC’s embedded value, which is a measure of the consolidated shareholders’ value in an insurance company, to be around Rs 5.4 lakh crore as of September 30, 2021.
  Although the DRHP does not disclose the LIC’s market valuation, according to industry standards, it would be approximately three times the embedded value, or approximately Rs 16 lakh crore.
• Although the DRHP does not disclose the LIC’s market valuation, according to industry standards, it would be approximately three times the embedded value, or approximately Rs 16 lakh crore.
• According to a PTI report, the LIC mega IPO will help the government raise around Rs 63,000 crore to meet the government’s disinvestment target for the current fiscal year.

LIC FDI

• The Department for Promotion of Industry and Internal Trade (DPIIT) announced on Monday a government decision to allow up to 20% FDI in IPO-bound LIC, with the goal of facilitating the country’s largest insurer’s disinvestment.
• The decision on FDI in the insurance behemoth was approved by the Union Cabinet in February.
• The notification has added a paragraph to the existing policy that allows up to 20% FDI in LIC via the automatic route.