Big update on LIC IPO, Govt to submit final paper to SEBI soon, know all important details

LIC IPO Recent Updates in dgmartpro.com: With the announcement of LIC IPO, the discussion environment is intensifying. Questions like discounts for price bands, policyholders and retail investors are constantly being discussed. Although the government has not yet announced a date for the IPO due to market instability caused by the Russo-Ukrainian war, it is expected to be announced soon.

This IPO raises many questions in the minds of retail investors as well as policyholders. But on the other hand, there is a lot of curiosity in people’s minds about IPO. In an IPO, 10% of the shares will be reserved for LIC policyholders, but investors must keep in mind that they must have a demat account.

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The government will soon hand over the paper to SEBI, know all the important updates

The final paper on IPO may be submitted to the market regulator SEBI soon by the government. According to PTI, the documents will contain details of price range, discounts for policyholders and retail buyers and actual number of shares.

An official of the subject told PTI that the draft document (DRHP) has been approved by SEBI (Securities and Exchange Board of India), now the next step will be to file a prospectus (Red Herring Prospectus or RHP) where the price range, the actual number of shares will be stated. At the moment we are monitoring the situation, the timing of the sale of shares will be decided soon.

SEBI approved the draft document (DRHP) filed by LIC on February 13, 2022. This has cleared the way for selling shares.

This will help the government raise Rs 60,000 crore to meet its investment target for the current financial year.

According to DRHP, under the IPO, the government will sell 316 million equity shares of LIC or its five percent stake in the company. If it does not sell in March, the government will fall short of its revised investment target for the current fiscal year.

According to the draft document, the underlying value of LIC has been worked out by an international valuation firm Milliman Advisors. As on September 30, 2021, the company had an underlying value of Rs 5.4 lakh crore. The underlying value is based on the share price of the insurance company’s shareholders.

The market value of LIC is not disclosed in DRHP. However, according to industry standards, it will be about three times the underlying value or Rs 16 lakh crore.

The government has 100 per cent stake in LIC or more than 632.49 crore shares. The face value of these shares is Rs. 10 per share.