The much-awaited initial public offering (IPO) of Life Insurance Corporation of India (LIC) might bring good news for its policyholders. The insurance company may offer a discount to its policyholders as it looks to file its draft red herring prospectus (DRHP) this week.
The upcoming public offering of LIC might give 5 per cent to its policyholders, sources told ET Now. Along with the policyholders, retail bidders and employees are also likely to be given a concession on the IPO’s price band.
Meanwhile, another source added that the insurer could file its draft red herring prospectus (DRHP) on February 10.
DRHP will highlight the stake that the government will dilute through IPO. Earlier, it was reported that the Centre is likely to sell a 5-7 per cent stake in the IPO, to raise around Rs 65,000-75,000 crore.
According to the Department of Investment and Public Asset Management (DIPAM) Secretary Tuhin Kanta Pandey, LIC disinvestment amount will be included in this year’s Budget. He had said that the government’s aims to list it before March 31.
The insurance behemoth had reported a profit after tax of Rs 1,437 crore for the first half (April-September) of the current financial year, compared to Rs 6.14 crore in the year-ago period.
In September last year, the government appointed 10 merchant bankers, including Goldman Sachs (India) Securities Pvt Ltd, Citigroup Global Markets India Pvt Ltd and Nomura Financial Advisory and Securities (India) Pvt Ltd, to manage the mega initial public offering of the insurance firm.
Other selected bankers include SBI Capital Market Ltd, JM Financial Ltd, Axis Capital Ltd, BofA Securities, J.P. Morgan India Pvt Ltd, ICICI Securities Ltd, and Kotak Mahindra Capital Co Ltd.
Moreover, as it gears up for IPO, LIC last month appointed 6 independent directors on its board to meet regulatory norms of corporate governance.
