India in full spirit to launch LIC IPO on time, says Finance Minister

India in full spirit to launch LIC IPO on time, says Finance Minister

The government has appointed bankers and legal advisers for the sale of shares.

Finance Minister Nirmala Sitharaman Finance Minister Nirmala Sitharaman

Life Insurance Corporation of India (LIC) is set to launch its shares soon. The government is making efforts to open the initial public offering (IPO) of the state-governed Life Insurance Corporation of India by March of next year. If the process delays any further, it won't be due to political reasons, said Finance Minister Nirmala Sitharaman.

Sitharaman in an interview with Bloomberg said, "We are pushing to have it done." She was asked if the IPO will be launched within the current financial year. "The problem is not that we don't want it or we are pussyfooting on it now, it is more a question of doing the due process", she added.

She mentioned that the valuation of a company as big as LIC takes almost a year, which "hasn't been done" for 65 years. Hence the process will take time.

Last year, Sitharaman announced plans to launch the IPO for LIC, but the economy was struck by Covid-19, slowing the process. The offering was again revived by the minister in February 2021, but the report hasn't been finalised yet. Bankers and legal specialists are also appointed by the government and meetings are held with stakeholders.

LIC holds $511 billion of assets, equivalent to the size of India's mutual fund industry, controlling two-thirds of India's market. The government is seeking to raise as much as 10 trillion rupees ($133 billion) by selling up to a 10 per cent stake. The sale of a 5 per cent stake would make it India's largest IPO, while a 10 per cent dilution would make it the second-biggest of an insurer globally, Bloomberg reported.

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