LIC DRHP to be filed this week, embedded value upwards of Rs 5 lakh cr: DIPAM Secy

The Draft Red Herring Prospectus (DRHP) for Life Insurance Corporation (LIC) initial public offering will be filed this week with the Securities and Exchange Board of India (SEBI), said DIPAM Secretary Tuhin Kanta Pandey. He added that the LIC IPO is scheduled for next month. Speaking at the BT Budget Roundtable 2022, Pandey said, "The Great Indian IPO is scheduled for March and our DRHP will be filed this week with SEBI." 

When asked if the accruals will come in this financial year or the next, Pandey said that the government is counting it in the current financial year. “But we have to keep in mind that we have policyholders there and by law, policyholders reservation in this IPO, which is again a unique thing, going by the fact that policyholders have really blessed this organisation for a long time. We want them to be the stakeholders, shareholders, and possibly they will also be offered discounts,” he said.

Pandey added that LIC is doing a big campaign, as per the legislation, to try and enlist them for their PAN account and demat accounts, so that they can possibly participate. In addition there will be a huge number of retailers. “If everything goes well, it will be a big moment for the Indian stock market because this is a very large organisation. A big market cap is coming to the stock market,” he added. 

The embedded value of LIC is upwards of Rs 5 lakh crore, so people are making guesses, said Pandey. The company is at an early stage of marketing of the IPO. “Once the DRHP is filed, the price will be discovered over the period. We have a month to go. But it suffices to say that there is a tremendous amount of interest from the general public,” he said.

Tuhin Kanta Pandey was speaking at a session along with Finance Secretary Dr. T.V. Somanathan, Finance Secretary, and Revenue Secretary Tarun Bajaj. Held a week after Budget 2022, BT Budget Roundtable 2022 brings together bigwigs such as Finance Minister Nirmala Sitharaman, Railways Minister Ashwini Vaishnaw, Niti Aayog CEO Amitabh Kant, and former CEA Dr Arvind Subramanian to speak on the state of the economy. 

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