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LIC IPO: SEBI’s approval for draft prospectus expected before Mar 10

The draft red herring prospectus of Life Insurance Corporation (LIC) initial public offering (IPO) is expected to receive approval from SEBI before march 10. According to the DRHP, 5 percent of equity stake which is up to 31,62,49,885 (31.62 crores) equity shares will be available through the offer for sale (OFS). LIC’s total value stood at ₹5,39,686 crore as of September 30, 2021. LIC can become India’s largest company by market capitalisation with an estimated valuation of ₹8-10 lakh crore after being listed.

The Budget 2021-22 had set a target of ₹1.75 lakh crore in disinvestment, as against ₹32,835 crores collected in the last financial year. Out of the ₹1.75 lakh crore, ₹75,000 crores will be CPSE disinvestment receipts, and ₹1 lakh crore is to come from selling government stakes in financial institutions and the public sector banks.

The government has selected 10 merchant bankers, including Kotak Mahindra Capital, Citigroup Global Markets India Pvt. Ltd, Goldman Sachs (India) Securities Pvt. Ltd, and Nomura Financial Advisory and Securities (India) Pvt. Ltd, to deal with the super IPO of the country’s biggest insurer.

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