LIC IPO: Listing to be 'high value enhancing in long term', says DIPAM secy 

Department of Public Investment and Asset Management (DIPAM) Secretary Tuhin Kanta Pandey, addressing the media, said today that the listing of the public insurer Life Corporation of India’s (LIC) IPO will be a high value enhancing event in the long term as government had a strong commitment to disinvest the public insurer.

He also mentioned that the government is expecting significant retail participation and that this is going to be the biggest IPO in India ever.  

Pandey further noted, “The IPO is just the beginning. We want to champion LIC as a long-term value creator in the equity markets. The decision to list now has taken into multiple factors, including market demand and conditions.” He stated that LIC IPO was “considered unthinkable for a long, long time” as LIC was always considered an investor.  

During the same event, LIC chairman MR Kumar said that LIC struggled to sell insurance in India for the first two decades and gathered momentum in 70s and 80s, which he called LIC 1.0. He said the public insurer then adapted to competition and LIC 2.0 ushered in and with the mega IPO worth around Rs 21,000 crore will bring in LIC 3.0.  

According to LIC, “91 per cent of the country is covered by LIC’s brick-and-mortar offices. LIC had 66 per cent NBP market share in FY21. Even in COVID times, we have been able to show a consistent growth rate.” LIC’s assets under management (AUM) was equal to ~17 per cent of India’s GDP in FY22 and the value of new business in H1FY22 stood at around Rs 1,500 crore.  

About LIC IPO

The issue will open on May 4 and will close on May 9. Pegged at Rs 902-949 per share, the government will divest 3.5 per cent stake in LIC to garner almost Rs 21,000 crore through this issue. Retail investors will get Rs 345 per share discount on the cut-off price while policyholders will get them Rs 60 lesser. It will be an offer for sale (OFS) by the government and will not comprise any fresh issue of equity shares.  

Also read: LIC IPO to open on May 4: Check issue size, price band, other details