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HomeNewsFor Mega LIC Listing, Government Pulls Out All Stops: Report

For Mega LIC Listing, Government Pulls Out All Stops: Report


For Mega LIC Listing, Government Pulls Out All Stops: Report

LIC instructions greater than 65% of India’s marketplace for life insurance coverage insurance policies

New Delhi:

The federal government has requested regulators for a swift assessment of Life Insurance coverage Company’s draft prospectus, two authorities sources with information of the matter mentioned – because it pulls out all of the stops to have the nation’s greatest IPO accomplished by the top of March.

The Securities and Alternate Board of India (SEBI) has been urged to finish its vetting course of in lower than three weeks as an alternative of the 75 days it often requires, they mentioned.

“Now we have 10 bankers for the deal. They’re accessible 24/7 for any questions SEBI might need,” mentioned one of many authorities officers, including {that a} “clear” draft prospectus can be submitted.

The official additionally mentioned the federal government’s divestment division was solely targeted on the IPO for the enormous state-backed insurer from which it hopes to achieve as a lot as $12 billion, and had put apart different privatisation plans for this fiscal yr.

The draft prospectus is more likely to be submitted to SEBI within the subsequent few days, mentioned the sources, who weren’t authorised to talk to media and declined to be recognized.

The finance ministry, SEBI and LIC didn’t reply to Reuters requests for remark.

Having pledged quite a few instances to checklist LIC by the top of the monetary yr, Prime Minister Narendra Modi’s administration is eager to keep away from any lack of face and achieve additional momentum for its privatisation programme aimed toward replenishing authorities coffers.

LIC, which has practically $500 billion in property and instructions greater than 65% of India’s marketplace for life insurance coverage insurance policies, too is sparing no effort to make sure its IPO is a hit.

Along with heavy promoting in native newspapers, some 1.2 million subject brokers have been dispatched throughout the nation to woo lots of its greater than 250 million policyholders into changing into retail buyers for the primary time. Policyholders have additionally acquired a textual content message recommending they open an digital inventory holding account early to allow them to participate within the IPO.

How profitable any LIC inventory sale will probably be, nevertheless, stays an open query.

The federal government is eager to garner as a lot as $12 billion from the IPO. Promoting 5% of LIC’s inventory to achieve that quantity can be one indication of success however the authorities can be keen to think about promoting as a lot as 10%, authorities and banking sources have mentioned.

“Now we have by no means seen a problem dimension of this proportion within the Indian market and although we all know an organization like LIC will garner consideration, it will not be that simple,” mentioned a Mumbai-based funding banker engaged on the IPO.

“There are nonetheless a whole lot of transferring items to it to make this IPO a hit,” he added.

With LIC a family title within the nation, bankers engaged on the IPO say they’re assured of strong demand from retail buyers, however the energy of institutional demand will probably be key.

A lot of LIC’s financials, together with its ’embedded worth’ – a measure of future money move for all times insurance coverage corporations and the important thing monetary gauge for insurers, have but to be disclosed.

Many buyers are additionally more likely to be involved that the LIC’s funding selections together with these in loss-making state corporations could possibly be influenced by authorities calls for.

(This story has not been edited by wantpassport employees and is auto-generated from a syndicated feed.)

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