State-owned insurance behemoth LIC’s (Life Insurance of Corporation of India) initial public offering gets bids from large investors for twice the size of the anchor book, according to a Bloomberg report.
The anchor book of ₹56 billion for India’s largest public offering of ₹210 billion will be announced tomorrow.
Singapore’s GIC Pte and Norway’s sovereign wealth fund are among the anchor investors, the report said.
The government plans to dilute 3.5 per cent of its stake in LIC to raise ₹21,000 crore from the market next month. During the formation of LIC in 1956, the government had infused ₹5 crore as seed capital.
Reports said 50 per cent of the offer is reserved for QIPs, including anchor investors. Around 35 per cent is being reserved for retail investors, 15 per cent for high networth individuals and ten per cent for policy holders.
Thirty per cent of the portion reserved for QIPs is reserved for anchor investors, he said.
LIC has fixed the price band at ₹902-949 per equity share for the issue. The share sale is through an offer-for-sale (OFS) of up to 22.13 crore equity shares and will open on May 4 and close on May 9. The shares are likely to be listed on May 17.
The offer includes a reservation for eligible employees and policyholders. The retail investors and eligible employees will get a discount of ₹45 per equity share and policyholders will get a discount of ₹60 per equity share.
LIC’s embedded value, which is a measure of the consolidated shareholders’ value in an insurance firm, was pegged at about ₹5.4 lakh crore as of September 30 last year by international actuarial firm Milliman Advisors.
Based on investor feedback, the market value of government-owned LIC has been pegged at 1.1 times its embedded value or ₹6 lakh crore.