Teji Mandi Explains: LIC IPO is finally here!

After months of waiting, the giant LIC IPO is finally here! It is set to hit the market on May 4. The red herring prospectus (RHP) has clarified all the numbers. Let’s get into it!

Teji MandiUpdated: Friday, April 29, 2022, 04:29 PM IST
article-image
Teji Mandi Explains: LIC IPO is finally here! | (Photo by SUJIT JAISWAL / AFP)

IPO Details

The insurance behemoth’s price band has been fixed at Rs 902-949. The government will be offloading 3.5% of its stake in LIC. At the upper end of the price band, the issue is valued at Rs 21,000 crore. The issue will open for anchor investors on May 2. Shares will be allotted on May 12, and the stock will be listed on May 17.

Now investors can bid for shares in a lot size of 15 shares and multiples thereof. The maximum bid cannot cross Rs 2 lakh. There is an employee reservation of 1.58 crore shares, while 2.21 crore shares are reserved for policyholders. The government has reserved 10% for policyholders who will get a discount of Rs 60, while employees and retail investors will get a discount of Rs 45.

Policyholders who have one or more policies would be eligible to apply for IPO. In the case of joint policyholders, one of the two can apply for equity shares. PAN card details need to be updated in both these cases, and the applicant must have a Demat account. Moreover, policyholders with lapsed policies can also apply for the IPO.

Should This Concern You?

For years, LIC has been the investor of the last resort for the government seeking to bail out companies. If this continues even after the listing, it will affect the financials and investors’ interest in the stock. Several analysts have spoken about this earlier, and it will continue to be a major concern.

What Lies Ahead?


LIC IPO will receive bumper interest, but its financial road remains uncertain. And that’s because it has thousands of assets and investments, it will be difficult to value the company and its business. Also, LIC is losing market share to private players. It’ll be interesting to see what happens after it’s listed.

(To receive our E-paper on whatsapp daily, please click here. To receive it on Telegram, please click here. We permit sharing of the paper's PDF on WhatsApp and other social media platforms.)

RECENT STORIES

There'll be change at national level & nobody can stop it: KCR after meeting former PM HD Deve Gowda...

There'll be change at national level & nobody can stop it: KCR after meeting former PM HD Deve Gowda...

'Vladimir Putin won't win Ukraine war': German Chancellor Olaf Scholz at Davos

'Vladimir Putin won't win Ukraine war': German Chancellor Olaf Scholz at Davos

Uttar Pradesh: Four people arrested for offering namaz at Taj Mahal mosque

Uttar Pradesh: Four people arrested for offering namaz at Taj Mahal mosque

Jammu and Kashmir: Grenade hurled near Qazigund Dak Bungalow in Kulgam district, no injuries...

Jammu and Kashmir: Grenade hurled near Qazigund Dak Bungalow in Kulgam district, no injuries...

8 years of Modi misrule: NCP on govt's 8th anniversary

8 years of Modi misrule: NCP on govt's 8th anniversary