LIC IPO: Everything you need to know about LIC public offerings

As the government prepares to publish a Proposed Red Herring Prospectus (DRHP) for LIC IPO (initial public offering), all hands are on the value of the state-run insurer’s massive stock offering.

LIC has already produced its bookkeeping through September 2021, and the December statements will be completed by February 20. EV is a metric that represents a life insurance company’s worth. The DRHP will define the quantity and financing of the LIC IPO.

LIC IPO Valuation:

The underlying valuation of LIC has been confirmed at more than 5 trillion INR (USD 66.82 billion). According to a govt official managing the nation’s biggest IPO.

“I can say the inherent value might be greater than five trillion rupees, and the current valuation will be multiple copies of that,” Tuhin Kanta Pandey, Secretary of the Department of Investments and Public Asset Management (DIPAM), told Reporters.

The intrinsic value will help determine the marketplace price of LIC as well as how much money the administration collects from the float. This will be critical for the government to accomplish its divestiture goals and maintain the fiscal deficit under control.

 LIC IPO Amount Size:

The administration of Pm Narendra Modi reduced its divestiture aim for the fiscal year. Concluding in March to 780 billion ₹ (USD 10.43 billion), down from a previously projected goal of 1.75 trillion ₹. It is counting on the initial public offering of LIC to help it fulfill its revised aim.

It has so far raised approximately 120 billion ₹ through the sale of interests in other enterprises. Selling 5% of LIC’s shares to acquire that money would be optimal. However, the administration is going to prepare to sell up to 10%, according to official and financial sources.

Date of the LIC Initial Public Offering:

According to the report, the government is likely to file draught documents for the massive LIC initial public offering with financial regulatory Securities and exchange board in the next week, with a part of the issue earmarked for anchor investors.

Read More: boAt Set to Float IPO Worth Rs 2000 Crore: Things You Should Know As An Investor

Why should you invest in LIC IPO?

These are among the primary reasons why individuals should consider investing in this IPO –

– The Life Insurance Corporation of India boasts a reputed brand with stable financial standing and robust market presence.

– Investing in LIC could favour investors significantly. The company clocked stock market profits of more than Rs. 10,000 crores in this June quarter. Its strong fiscal standing, robust fund size, and association with the government make LIC a lucrative investment opportunity for many.

How to apply for LIC IPO?