India's Largest IPO - LIC garners over Rs 10k crore on day 1

4 May 2022 , 07:41 PM

Life Insurance Corporation of India’s initial public offering, the country’s biggest ever opened for subscription on Wednesday, May 4, 2022. The issue saw a robust response from its Policy Holders, its Employees and the Retail Investors. GoI, acting through the Ministry of Finance is looking to raise as much as Rs 21k cr by dilution 3.5% of its holding.

The offer received bids for 10,86,45,360 shares against the offered 16,20,78,067 equity shares (excluding shares offered to anchor investors), as per the 7:00 pm data available on the bourses. The IPO is through an offer-for-sale (“OFS”) of up to 221,374,920 Equity Shares of Face Value of Rs10 each.

The reserved portion for eligible policyholders was subscribed 1.99 times, the portion reserved for eligible employees was subscribed 1.17 times.

Retail investors bid 0.60 times the shares reserved for them, while the part set aside for non-institutional investors was subscribed 0.27 times. Qualified institutional buyers portion saw subscription of 0.33 times. Overall the issue was subscribed 0.67 times on day 1.

On Monday, LIC raised Rs5,627 crore from anchor investors, who were allotted 5,92,96,853 equity shares at the upper price band of Rs 949 per share.

India’s largest life insurer, LIC had a market share of 61.6% in terms of premiums or GWP, 61.4% in terms of New Business Premium (or NBP), 71.8% in terms of number of individual policies issued, and 88.8% in terms of number of group policies issued, for the nine months ended December 31, 2021

Kotak Mahindra Capital Company Limited, Axis Capital Limited, BofA Securities India Limited, Citigroup Global Markets India Private Limited, JM Financial Limited, J.P. Morgan India Private Limited, Goldman Sachs (India) Securities Private Limited, ICICI Securities Limited, Nomura Financial Advisory and Securities (India) Private Limited and SBI Capital Markets Limited are the book running lead managers to the issue.