Government files draft document for LIC’s IPO with SEBI

The government on Sunday filed a draft document for LIC IPO with market regulator SEBI.

The IPO is expected to hit the capital markets in March.

According to the draft red herring prospectus (DRHP) filed with SEBI, the government will sell over 31 crore equity shares of LIC.

Tuhin Kanta Pandey, Secretary, Department of Investment and Public Asset Management (DIPAM), tweeted, “DRHP for LIC’s IPO has been filed with SEBI today.”

The government aims to list Life Insurance Corporation (LIC) on the stock exchanges by March.

A portion of the IPO will be reserved for anchor investors. Also, up to 10 percent of LIC’s IPO issue will be reserved for policyholders.

LIC’s IPO assumes significance for the government amid the projection of a shortfall in the government’s disinvestment target by Rs 78,000 crore for the current fiscal. The government has so far raised around Rs 12,000 crore through the privatization of Air India and stake sale in other PSUs.

LIC had a domestic market share of over 64.1 per cent in 2020. According to Crisil’s report, LIC is the third largest company in the world in terms of life insurance premiums.

According to the report, LIC’s market share was 100 percent in the pre-2000 era, which gradually came down to 71.8 percent in 2016. In 2020, LIC’s market share further reduced to 64.1 percent.