LIC IPO to open next month? Here's all you need to know
India Today
The LIC IPO is expected to open on March 11 for anchor investors and a couple of days later for other investors. Here's a rundown of key details you need to know about the public issue:
The wait could finally be over. The LIC IPO is expected to open on March 11 for anchor investors and a couple of days later for other investors. The insurance giant is expected to get regulatory approval by the first week of March, following which an indicative marketing price band will be set.
Life Insurance Corporation (LIC) filed its draft red herring prospectus (DRHP) on Sunday. Market rumours indicate the size of the share sale could be about Rs 65,400 crore at a price band of Rs 2,000-2,100 apiece. However, LIC has denied the rumours of the issue date and the IPO size. The DHRP, meanwhile, throws meaningful insight for those looking to invest in the LIC IPO.
LIC board has approved the Offer for Sale of up to 316,249,885 equity shares in accordance with Section 5(9)(c) of the Life Insurance Corporation Act. LIC has fixed a face value of Rs 10 each for the shares. The insurance behemoth will announce the price band following consultation with the book-running lead managers (BRLMs). Discount to eligible employees and policyholders will also be announced accordingly.
READ | Govt to sell 5% in LIC via IPO; embedded value nearly Rs 5.4 lakh cr
LIC will decide the offer price in consultation with the Book Running Lead Managers, on the basis of assessment of market demand and many quantitative and qualitative factors. Kotak Mahindra Capital Company, Axis Capital, BofA Securities, Citigroup Global Markets, Nomura Financial Advisory, Goldman Sachs (India) Securities, ICICI Securities, JM Financial, JP Morgan India Private Limited and SBI Capital Markets are the book-running lead managers for the issue.
Qualitative factors that will influence the decision include brand trust, business model, risk management, product mix among other aspects.
Quantitative factors are earnings per share, PE ratio, return on net worth, net asset value per share and comparison with listed industry peers.
