The firm with the largest agent network in the country of 1.35 million registered agents will try to lure policyholders to the IPO with a rumoured 10 percent discount.
The initial public offering of Life Insurance Corp of India (LIC) is likely to run from March 10 to 14 and the share sale could be worth about Rs 65,400 crore at a price band of Rs 2,000-2,100 apiece, going by market rumours.
This comes after the government, which filed LIC draft papers on Sunday for the country’s biggest IPO, denied rumours on the issue date, saying any decision on valuation will be taken after roadshows with investors and the listing will be done in March.
However, speculation is rife about key aspects of the public issue which is likely to reserve 3.16 crore shares for LIC’s 283 million policyholders.
The state-run insurance giant, armed with the country’s largest network of 1.35 million registered agents, will try to woo policyholders to the IPO with a rumoured 10 percent discount. To be sure, many of the policyholders will be first-time investors in equities.
Let’s take a look at the LIC public issue rumour mill which is in overdrive.
Issue Opens: March 10
Issue Closes: March 14
Issue Price: Rs 2,000-2,100 per share
Issue Size: 31,62,49,885 shares
Offer-for-Sale: 31,62,49,885 shares which is equal to Rs 65,416.29 crore
Discount: 10 percent for employees and policyholders
Price Band Announcement: March 7
Anchor Investors Allotment: March 9
Market Lot: Seven shares
Employees: 1.58 crore shares (10 percent discount = Rs 1,890)
Policyholders: 3.16 crore shares (10 percent discount = Rs 1,890)
Anchor: 8.06 crore shares = Rs 16,935.18 crore
Qualified Institutional Bidder: 5.37 crore shares = 11,290.12 crore
Non-Institutional Investors: 4.03 crore shares = 8,467.59 crore
Retail Individual Investor: 9.41 crore shares = 19,757.71 crore
Listed Peers: SBI Life Insurance Company, HDFC Life Insurance Company, ICICI Prudential Life Insurance Company