LIC IPO Latest Updates: Government May Review LIC IPO Timing Amid Russia-Ukraine Crisis; Here Are Top 5 Updates
LIC IPO is under threat due to the ongoing war between Russia and Ukraine. Investors have been waiting for a long time for the IPO of state-owned insurance company LIC. But this IPO can be postponed for the next financial year.
New Delhi, March 2: LIC IPO is under threat due to the ongoing war between Russia and Ukraine. Investors have been waiting for a long time for the IPO of state-owned insurance company LIC. But this IPO can be postponed for the next financial year. According to sources, the government may hold a meeting, in which due to the escalating war between Russia-Ukraine, the timing of the IPO will be discussed.
The government, which owns 100% of LIC, is selling 316 million shares, representing 5% of its equity stake through the IPO. The issue is a 100% offer-for-sale, meaning LIC will not receive any proceeds from it.
The net worth of LIC as of 30 September 2021 is estimated at Rs 8,000 crore. According to the LIC Act, the stake of the Center in LIC cannot be less than 51%. The Act also states that no investor, either singly or in a group or any entity, can take more than 5 per cent stake in LIC. LIC IPO Created A Lot of Interest, Says FM Nirmala Sitharaman in Post Budget 2022 Press Conference
The rule of blocked amount and UPI mechanism has been kept for IPO. Meaning, if you apply in IPO, your money will be blocked until the shares are allotted. If shares are not received, full refund will be given. You can also deposit money for IPO through UPI.
The Life Insurance Corporation of India (LIC) has submitted Draft Red Herring Prospectus paving way for the most awaited public issue of the year. Life insurance policy holders who have one or more than one policy on the DRHP submission date i.e. 13th February 2022 shall be eligible for claiming the quota benefit, where 10 per cent of the total LIC India share offer have been kept reserved for the LIC policyholders. However, market is buzz about the discount that LIC of India may announce for the policyholders.
According to stock market experts, while going for listing at Indian bourses, a company is allowed to announce discount to its employees applying for its public issue. Similarly, Life Insurance Corporation of India or LIC is also allowed under SEBI (Securities and Exchange Board of India) to give discount to its life insurance policyholders. They said that under SEBI norms, LIC is allowed to give up to 10 per cent discount on the price offer. On how much discount LIC may offer to its policyholders, they expected maximum 10 per cent discount for LIC policyholders in the upcoming public issue of the insurer. LIC IPO: Draft Papers Filed With SEBI, Likely to Raise Up to Rs 63,000 Crore From 5% Stake Sale
It is to be noted that the exemption for taking IPO will be available only on the basis of the eligible policy. Qualified policy means the policy should be active in the records of LIC.
If the policy is over in Maturity, Surrender and Death case, then you will not be able to participate in IPO.
If a policy is taken before the draft is submitted with SEBI, but the bond is received later, then you can still participate in the IPO.
(The above story first appeared on LatestLY on Mar 02, 2022 02:32 PM IST. For more news and updates on politics, world, sports, entertainment and lifestyle, log on to our website latestly.com).