Govt 'concerned' about dip in LIC share price; calls it temporary blip
June 11, 2022 15:02 ISTSince the day of listing, LIC shares have remained below the issue price and had touched a low of Rs 708.70 and a high of Rs 920.
Since the day of listing, LIC shares have remained below the issue price and had touched a low of Rs 708.70 and a high of Rs 920.
LIC shareholders have lost around Rs 1,23,686 crore since its listing on May 17. The scrip is trading 20% lower than the IPO issue price.
The shares of insurance sector giant Life Insurance Corporation of India (LIC) debuted on the stock exchanges on a weak note on Tuesday. This led to the bombardment of hilarious memes and jokes on the social media platforms. Take a look!
The Initial Public Offering (IPO) of Life Insurance Corporation (LIC) closed on May 9 and shares were allocated to bidders on May 12. The government sold over 22.
The largest insurer, state-owned LIC's first-year premium or new business premium more than doubled (at a 141 percent rise) to Rs 11,716 crore as against Rs 4,856.
Against 16,20,78,067 shares on offer, 29,08,27,860 bids were received, according to the data posted on stock exchanges at 7 pm. However, the Qualified Institutional Buyer (QIB) category is yet to be fully subscribed.
Subscription for non-institutional investors' segment stood at 76 per cent, while that for QIBs' portion was lower at 56 per cent.
Against 16,20,78,067 shares on offer, 16,25,35,125 bids were received, making the public issue fully subscribed, as per data on stock exchanges as of 6.24 pm.
RBI's sudden rate hike coinciding with the first day of LIC IPO subscription baffled marketers. Confused as to what is happening Twitterverse churned funny memes and jokes. Check out the best ones here.
The government aims to generate about Rs 21,000 crore by selling 3.5 per cent stake in the insurance behemoth. LIC's initial public offering (IPO), open for retail and institutional investors, is set to close on May 9. The issue period also includes bidding on Saturday, May 7.
LIC has fixed the price band at Rs 902-949 per equity share for the issue. The offer includes a reservation for eligible employees and policyholders.
Congress general secretary and chief spokesperson Randeep Surjewala asked why did the government reduce LIC valuation from Rs 12-14 lakh crore in February to Rs 6 lakh crore in just two months.
As per a note by GEPL Capital on the LIC IPO, LIC invests these funds across stocks and bonds. They own 4 per cent of all listed stocks in India and more government bonds than the RBI.
The government had in February planned to sell s 5 percent stake or 31.6 crore shares of the insurance behemoth and had filed draft papers with Sebi.
The issue size is expected to be worth Rs 21,000 crore, valuing the country's largest insurer at Rs 6 lakh crore.
The issue size is expected to be worth Rs 21,000 crore, valuing the country's largest insurer at Rs 6 lakh crore.
If the government misses the May 12 window available with it, LIC would have to file fresh papers with Sebi giving the results of December quarter and also update the embedded value.
The government was looking to sell 5 per cent stake in Life Insurance Corporation (LIC) this month, which could have fetched over Rs 60,000 crore to the exchequer. The IPO would have helped meet the curtailed disinvestment target of Rs 78,000 crore this fiscal.
Finance Minister Nirmala Sitharaman too had indicated review of the IPO in view of the evolving geopolitical situation. "Ideally, I would like to go ahead with it because we had planned it for some time based purely on Indian considerations," Sitharaman had said in an interview with the Hindu Business Line.
The decision in this regard was taken by the Union Cabinet, chaired by Prime Minister Narendra Modi. The government has approved listing of shares of LIC on the stock market through an IPO by part-sale of its stake in the insurer and raising fresh equity capital.
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