The market regulator has approved the much-awaited IPO of 2022. According to the sources, SEBI has issued an observation letter. LIC had filed it’s Draft Red Herring Prospectus (DRHP) with SEBI in February. As per DRHP, the issue would be an offer to sell 31,62,49,885 (31.62 crores) equity shares by the government, which holds a 100 per cent stake in the insurance behemoth.
A total of 50% of the net issues would be reserved for qualified institutional buyers (QIBs), 15 per cent slotted to non-institutional buyers, and 35 percent of the offer has been fixed for the retail portion.
Policyholders and employees of LIC are likely to have reservations, as per the DRHP, and one-third of the anchor portion will be reserved for domestic mutual funds.
Reports suggest that the government may defer the mega offerings of the next financial year, starting from April 1, due to the Russia-Ukraine war. The government was expected to sell a 5 per cent stake this month, which could be valued over Rs. 60,000 crore to the exchequer.
LIC is the largest asset manager with an 80 per cent market share, according to Edelweiss. It has a deep reach of 75 per cent market share on a policy basis, it added.