The first public offering of 31.6 million shares, which is five percent of government’s stake will be on the market in March. Employees and policy owners of the insurance giant would be able to get a cut over the price of the floor.
India’s biggest public offering is set to launch as Life Insurance Corporation of India (LIC) submitted an Draft Red Herring Prospectus (DRHP) with the capital regulator Securities and Exchange Board of India (Sebi) to facilitate the purchase of a five percent stake to the government. Policyholders and employees of the nation’s biggest insurance company would receive a cut over the cost of the floor.
In order to apply for the LIC’s IPO the policyholders should be aware of some specifics.
LIC IPO DATE
The first public offering of 31.6 crore shares , which is five percent of government’s stake will go live in March. Employees and policy holders of the insurance giant will be able to enjoy a discounted rate over the cost of the floor.
LIC IPO SIZE, VALUE
While the draft documents don’t reveal the market value of LIC in accordance with the industry norms, it will be three times embedded value, which is around 16 lakh crore.
“The DRHP of LIC IPO has been filed today with the SEBI. For filing valuation about 31.6 crore shares are on offer representing 5 per cent equity,” Department of Investment and Public Asset Management (DIPAM) Secretary Tuhin Kanta Pandey tweeted.
Sources from the merchant banking industry said that the government expects to earn up to 63,000 crore (about USD 8 billion) from the IPO as per an PTI report.
LIC IPO PRICE
It is LIC IPO is an offer for sale (OFS) by the Government of India and no new issue of shares is planned from Life Insurance Corporation (LIC). The Government has a 100% stake, in LIC, which is more than 632.49 million shares of LIC.
It is worth Rs . 10 per piece.
BIGGEST IPO IN HISTORY OF STOCK MARKET
The LIC IPO is expected to be the largest IPO that has ever occurred in the Indian stock market. Once it is listed, its market value is comparable to that of top companies such as RIL as well as TCS.
As of now, the sum raised by Paytm’s IPO of Paytm in 2021 was among the highest ever, at nearly 18300 crore. It was following by Coal India in 2010 at close to Rs 15,500 crore, and Reliance Power in 2008 at 11700 crore.
LIC IPO DISCOUNTS FOR POLICYHOLDERS
The draft papers of the government did not mention the discount to be provided to policyholders and LIC employees who participate in an offering to the general public.
But, as per guidelines according to the rules, up to 5 percent of the issue size may be reserved for employees , and up to 10 percent for policy holders.
LIC-PAN LINK, DEMAT ACCOUNT MUST
The policyholders who plan to invest in the LIC’s IPO must make sure the validity of their Personal account Numbers (PAN) is in good standing to Life Insurance Corporation of India.
In addition, policy holders need DEMAT accounts in order to be able to participate in the LIC IPO.
“In order to participate in any such public offering, policyholders will need to ensure that their PAN details are updated in the Corporation’s records,” LIC had stated in its advertisement for 2021.
“Further subscribing to any public offering in India is only possible if you have a valid DEMAT account,” LIC had stated in its advertisement.
