LIC OFS draws Rs 36,400-cr institutional bids
Life Insurance Corporation
our years after the initial public offering (IPO), which had fetched Rs 21,000 crore, the government has launched LIC’s offer for sale (OFS) whose size compares with the upcoming mega IPO offerings of the NSE and Reliance Jio Platforms.
New Delhi: Institutional investors on Tuesday over-subscribed the government’s 6.5 per cent share sale offer in Life Insurance Corporation (LIC) by putting in bids worth Rs 36,400 crore.
Four years after the initial public offering (IPO), which had fetched Rs 21,000 crore, the government has launched LIC’s offer for sale (OFS) whose size compares with the upcoming mega IPO offerings of the NSE and Reliance Jio Platforms.
Through the two-day OFS, the government is selling up to 6.5 per cent stake or over 82.22 crore in the country’s largest insurer LIC at a floor price of Rs 382/share. The issue comprises a base offer size of 2.5 per cent, with a green shoe option of 4 per cent. The issue will open for retail investors on Wednesday. Institutional investors put in bids for over 94.45 crore shares, at an indicative price of Rs 383.84/share. The bids are valued at Rs 36,400 crore at the indicative price bid. Shares of LIC slid 7.86 per cent to close at Rs 391 on the BSE. Its market capitalisation stands at Rs 4.95 lakh crore. The floor price of Rs 382/share was set at a 10 per cent discount over Monday’s closing price of Rs 424.35 on the BSE. At the floor price, the sale of over 82.22 crore shares, or a 6.5 per cent stake at the given floor price will fetch about Rs 31,000 crore to the disinvestment kitty. The stake sale will help LIC achieve the minimum public shareholding requirement mandated by market regulator Sebi ahead of schedule. Sebi had given LIC time till May 16, 2027, to achieve a minimum 10 per cent public shareholding.
