LIC second top money destroyer in Asia this year
Life Insurance Corporation of India (LIC) has emerged as the biggest money destroyer in Asia’s initial public offerings in 2022. LIC IPO, which was India’s biggest ever IPO after Paytm (2021) and Coal India (2010). Second in terms of loss in market cap since listing. That’s right behind South Korea’s LG Energy Solutions, which saw its share price drop more than 30% after a spike on debut. LG Energy Solutions, a subsidiary of LG Chem, made its debut on the Korea Exchange (KRX) on 27 January.
The state-owned life insurance company’s share price has fallen 29% since its launch on May 17. The stock has wiped out more than Rs 1.20 lakh crore of investors. Its market capitalization now stands at Rs 4.27 lakh crore, as per BSE data.
The insurance giant has lost its position as the fifth most valuable company by market valuation in the country. LIC’s market cap on May 17 stood at Rs 5.54 lakh crore, behind only Reliance Industries, Tata Consultancy Services, HDFC Bank and Infosys. It is now ranked seventh in the ranking of top 10 firms.
The government had fixed the issue price of LIC’s shares at Rs 949 after a successful IPO, which was oversubscribed almost 3 times. It debuted in the market at Rs 872 per share. As of June 13 closing, the stock has lost 29.58 per cent so far from its issue price of Rs 949.
As per the calculations, if a person has bought 1,000 shares of LIC at Rs 949 (total investment 1,000 x 949 = Rs 9,49,000), that person’s assets have reduced by about Rs 2,80,000 in a month.
Meanwhile, the government has said that it is “concerned” about the temporary default in LIC shares and the insurer’s management will look into these aspects and enhance shareholders’ value.
Tuhin Kanta Pandey, Secretary, DIPAM said, “We are very concerned about the temporary blip in LIC share price. It will take time for people to understand LIC (Fundamentals). LIC management will look into all these aspects and value the shareholders. will increase.” Last week.
LIC was formed on 1st September 1956 by merging and nationalizing 245 private life insurance companies with an initial capital of Rs 5 crore.
Read more: LIC share price falls below Rs 700 as anchor lock-in ends