LIC IPO Latest update: The Initial Public Offering (IPO) of Life Insurance Corporation of India (LIC), the country's largest insurance company, will come on May 4 and will close on May 9. This information was given by news agency PTI late on Monday evening, quoting sources. According to a PTI report, through the LIC IPO, the government will sell its 3.5 percent stake in the public sector company. With this, the government will get Rs 21,000 crore.
Based on the IPO, the valuation of LIC works out to Rs 6 lakh crore. In February, the government had planned to sell a five percent stake or 316 crore shares in LIC. Documents in this regard were submitted to the Securities and Exchange Board of India (SEBI).
There was talk about reducing the issue size.
However, the volatility in the market due to the Russo-Ukraine war also hampered the IPO plan. Last week, the government decided to reduce the issue size to 3.5 percent. Sources said that the government had also given documents to Sebi for exemption from the rule of five per cent stake sale.
What are SEBI rules
As per SEBI regulations, companies with a valuation of more than Rs 1 lakh crore are required to sell a five percent stake in an IPO. Milliman Advisors, an international valuation company, had worked out the underlying value of LIC at Rs 5.4 lakh crore on September 30, 2021.
According to details received from investors, the market value of LIC works out to 1.1 times its underlying value, or about Rs 6 lakh crore. The government has set a target of raising Rs 65,000 crore from disinvestment in the current financial year. LIC's IPO will have a major contribution to this.