LIC IPO to open on May 4th 2022
The Life
Insurance (LIC) corporation’s initial public offering (IPO), is expected to
open on 4th May 2022, close on 9th May 2022. It is the
first largest govt life insurance company IPO in Indian stock market history.
The size of
LIC’S IPO has been reduced to Rs 21,000
crore (cut to 40%) the SEBI has agree to the updated draft red herring
prospectus (DRHP), which state 3.5% stake sale instead of 5 % as mentioned
earlier in the previous draft papers and there will be no green shoe option (of
Rs 9,000) in the IPO, said an official.
·The
Government, who wholly owns the insurance, plans to raise the amount of Rs
21,000 crore by selling shares of Rs 22 crore (or 3.5% stake), listing at BSE
and NSE.
· The
Public issue will be reserve 35% of its offer for retail investors, 10% of the
shares will be reserved for LIC Insurance policy holders of India and 5% for
its employees.
· LIC
IPO Price expected btw 1,500 to 3,200 per share.
· Issue
Size and Offer for Sale at 316,249,885 Equity Shares of Rs 10 each, market lot
size is to be announced soon.
Reason to
cut LIC IPO Size
Reason for
cutting the size of LIC IPO is because Ukraine-Russia crisis, Foreign portfolio
investors(FPI) withdrawal from Indian Market and higher inflation and resultant
increase in the interest rates globally.
Who should
invest in LIC IPO?
If you want
to invest in LIC just for listing Gains then you should go for it, but if you
are thinking of long term investment then you should avoid as we have seen that
because of lock down most growing companies have shifted its sale from offline
mode to online mode but according to the analysis we have seen that LIC does not
pays much attention to its online segment which may result in reduction of its
profit in long term.