LIC IPO: officers of life insurance corporation (LIC) of India, in an interaction with global investors on the cusp of its upcoming IPO, indicated that the insurer may file its draft prospectus with markets regulator SEBI by the third week of January. This comes as the government has repeatedly affirmed that LIC IPO Will be floated before the end of FY 2022, and that work is underway. The Center has also denied claims that the IPO will be issued any time after the specified time.
Key things we know so far about LIC IPO:
a) According to a report in Times of India, LIC’s IPO is expected to file its draft papers with SEBI by the third week of January. This is in line with the government’s claims of having an IPO by the end of the 2022 financial year. Quoting sources, the report said that officials also informed global investors that LIC is increasing its focus on ULIPs, pension, annuity and health insurance products. He added that the company plans to recruit more youth to keep pace with the changing demographics.
b) In another Times of India report, the media body said that LIC’s IPO will not have the same value as is being speculated. According to some analysts quoted by The Times of India, the government may set prices higher than our expectations. According to the report, while the valuation of LIC’s IPO will be in several lakh crores, it will be in single digits. However, it will not take away the title of being the most valuable public offering in the country. The IPO will help the government meet its disinvestment target for FY22.
c) LIC shares will be provided to the policyholders at a discount, the company has said. It has also urged policyholders to open a demat account and link Aadhaar with LIC to buy shares during the public offering – a part of which will be set aside exclusively for them. In a December 2 notification, the insurance company said, “Policyholders for participating in any such public offering shall be required to ensure that their PAN details are updated in the records of the corporations. It is also possible to subscribe to the public offering if you have a valid demat account. Accordingly, policyholders should ensure that they have a valid demat account.”
d) Government has shortlisted Cyril Amarchand Mangaldas as legal advisor on the upcoming mega IPO of LIC. Apart from legal advisor, the government has appointed 10 top global and Indian merchant banks to manage the initial public offering of Life Insurance Corporation of India (LIC). It has also selected Concept Communications as the advertising agency and Kfintech as the registrar and share transfer agent for the IPO. The Department of Investment and Public Asset Management said it has appointed Goldman Sachs, JP Morgan, Citigroup, Nomura, Bank of America Securities, JM Financial, SBI Caps, Kotak Mahindra Capital, ICICI Securities and Axis Capital to manage the IPO.
e) The central government has denied the claims of LIC IPO. The Center last month rubbished media speculations, claiming that the government is unlikely to come up with an LIC IPO in the current financial year ending March 2022. The secretary of the Department of Investment and Public Asset Management said in a tweet that the plan is of course on, and added that the report was not accurate.
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