LIC IPO Opens Today: The biggest initial public offering (IPO) of India was also synonymous to bigger responses from investors, with the LIC IPO getting subscribed 64 per cent, as of Day 1 of opening. The employee and policyholders quota were booked 1.08 and 1.87 times respectively, amid attractive discount for these categories. The government is offloading 3.5 per cent or 22.13 crore shares and targets to raise Rs 20,550 crore through this public issue.
LIC IPO Subscription Update as of 5:00 PM on Day 1 (Source: BSE)
-Qualified Institutional Buyers (QIBs) subscribed 0.33 times
-Non-Institutional Investors subscribed 0.25 times
-Retail Individual Investors (RIIs) subscribed 0.57 times
-Employees subscribed 1.08 times
-Policyholders subscribed 1.87 times
-Total subscribed 0.64 times
Also Read: LIC IPO: 10 Key Things to Know About India’s Biggest IPO before You Subscribe Today
Life Insurance Corporation has set a price band of Rs 902 to Rs 949 per equity share for the public offer, which closes on May 9. Though trimmed, LIC IPO will be the biggest public offer to date in the country. The government had decided to reduce the size of the IPO due to the volatility in the market. LIC policyholders will get a discount of Rs 60 per equity share. Retail and employees will get a discount of Rs 45. LIC IPO is set to see a strong demand, given attractive pricing, say analysts. According to market observers, LIC is trading a healthy premium or GMP.
The company has reserved 50 per cent of the net issue for qualified institutional bidders (QIB), where non-institutional bidders (NIIs) will get 15 per cent of the issue. Remaining 35 per cent portion has been allocated to retail bidders.
The largest primary offering of the Indian equity market is open for subscription till Monday. Investors can bid for a minimum of 15 equity shares and then in the multiples thereof.
Majority of brokerages are bullish on India’s biggest ever initial public offering and have suggested subscribing to the issue. However, a few of them have raised concerns over declining markets and future stake sales by the government.
Life Insurance Corporation of India is valued at Rs 6 lakh crore, which is about 1.12 times its embedded value (EV) of Rs 5.4 lakh crore, which brokerages say is quite reasonable to its listed peers.
LIC has garnered over Rs 5,627 crore from the anchor investors by allotting them 5.92 crore shares at Rs 949 per share, the insurer said in a filing to exchanges. Out of them, 4.2 crore shares were allocated to 15 domestic mutual funds.
Some of the prominent names participating in the anchor round include ICICI Prudential Life Insurance, SBI Life Insurance, Kotak Mahindra Life Insurance, PNB Metlife Insurance, SBI Pension Fund and UTI Retirement Solutions Pension Fund Scheme. Foreign participation included Government of Singapore, Monetary Authority of Singapore, Government Pension Fund Global and BNP Investment LLP.
Shares of the company will be listed on both the NSE and BSE, tentatively on May 17.
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