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Government to sell 6.5 percent LIC stake via OFS
NDTV··4 Aug
The government will divest up to 6.5 percent of its stake in Life Insurance Corporation through an offer for sale at a floor price of Rs 382 per share. The two day sale opens for non retail investors on Tuesday and retail investors on Wednesday, potentially raising about Rs 31,000 crore for the disinvestment kitty.
Prism
What It Means For You
- Retail investors can bid for LIC shares from Wednesday at a floor price of Rs 382, a discount to Monday's close.
- Existing LIC policyholders and shareholders may see share price movement around the OFS window this week.
- Taxpayers benefit indirectly as proceeds add to the government's disinvestment kitty against a Rs 80,000 crore full year target.
What's Happening
- The government will divest up to 6.5 percent of its LIC stake through a two day offer for sale.
- The floor price is set at Rs 382 per share, a 10 percent discount to Monday's closing price of Rs 424.35.
- If fully subscribed, the sale of over 82 crore shares could raise about Rs 31,000 crore for the government.
LIC Stake Sale Follows A Decade-Long Disinvestment Push
- LIC first sold a 3.5 percent stake through its May 2022 initial public offering, raising about Rs 21,000 crore then.
- SEBI set a May 2027 deadline for LIC to reach 10 percent minimum public shareholding after the exchange listing.
- The government has raised about Rs 21,000 crore so far this fiscal from stake sales in seven public sector firms.
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