Govt to sell only 3.5% of its stake in LIC

The Life Insurance Corporation’s (LIC)'s initial public offering (IPO) is likely open in the first week of May, and the government has so far decided to sell only 3.5% of its holding as against the 5% proposed earlier, officials said.
LIC has until May 12 to launch its IPO under the earlier approval granted by the stock market regulator Sebi, and most likely the date could be May 2. The IPO had to be deferred due to the choppy market conditions triggered by Russia’s invasion of Ukraine. Officials said the 3. 5% dilution was subject to regulatory approvals.
To ensure that the shares are attractive to retail investors and to leave some money on the table for listing gains, the government has settled for a £60 billion valuation. Earlier, the market expected the government to sell shares worth around £120 billion.
At 3.5%, it’s £2.1 billion. It can be increased (up to 5%), but it has to be decided at the time of the red herring prospectus (RHP),” an official said, adding that reservations, discounts, issue dates and issue price will be known soon.