In a big relief to Life Insurance Corporation of India (LIC), Supreme Court on Thursday refused to stay the ongoing initial public offering (IPO) of the country’s top insurer. LIC is likely to finalise the share allotment of its mega IPO by the end of today.
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“We can’t give any interim relief in this matter. There are more than 73 lakh applicants already subscribed to the IPO. This is a matter of investment and we can’t give any relief in it,” the top court stated.
However, the court has issued notice to the government on petitions challenging the constitutional validity of certain sections’ provisions of the Finance Act, 2021 and LIC Act 1956, seeking a reply in four weeks.
The decision was taken by a bench of Justices DY Chandrachud, Surya Kant and PS Narasimha.
The court was hearing a batch of petitions filed against the LIC’s mega IPO. The petitioners challenged the legality of the government’s move to pass the decision to launch the LIC’s IPO through a Money Bill.
The country’s largest-ever IPO was oversubscribed 2.95 times as six days of bidding came to an end on May 9.
The price range for the issue was between Rs 902 and Rs 949 per share. LIC is likely to be listed on May 17.
The Centre expects to raise up to Rs 21,000 crore – a third of its original target – from selling a 3.5 per cent stake in the country’s top insurer.
The 66-year-old company dominates India’s insurance sector, with more than 28 crore policies.
LIC was the fifth-biggest global insurer in terms of insurance premium collection in 2020, as per the latest year for which statistics are available.
Few grey market data showed that the LIC shares would list Rs 15 below their issue price. However, policyholders and employees would still make a profit as they have got discounts in the public offer.