The much-awaited initial public offer (IPO) of Life Insurance Corporation of India (LIC) will open today. The issue will close on May 9. The issue comes amid a highly volatile market, which has forced the government to offer 3.5 per cent stake against the earlier planned 5 per cent stake sale. The insurance major plans to raise Rs 21,000 crore from investors.
On Monday, LIC collected Rs 5,620 crore from anchor investors signalling strong interest ahead of the share sale.
Here’s a look at five things that you need to know before you put in bids in the country’s largest IPO:
1. The price band of the IPO is Rs 902- Rs 949. The government will sell 3.5 per cent stake or 22,13,74,920 shares in the insurer through the IPO. Stake of the government, which currently stands at 100 per cent, will be trimmed to 96.50 per cent after the IPO.
2. The allotment of shares will be done on May 12, 2022 and shares will be listed on bourses on May 17.
3. Lot size of the IPO is 15 shares bidding for which one will have to spend Rs 14,235. A retail individual investor can apply for up to 14 lots or 210 shares by spending Rs 1,99,290.
4. The firm has fixed Rs 2 lakh investment limit each for policyholders, employees, and retail investors' quotas. Employees and retail investors will get a discount of Rs 45 per share. LIC policyholders will get Rs 60 per share discount on the final offer price. During the IPO, up to 15,81,249 shares and 2,21,37,492 shares will be reserved for employees and policyholders, respectively.
5. Those who bought the policy on or before February 13, 2022 are eligible to apply in the reserved policyholders quota in the IPO. The last date for updating PAN details in the policy for applying in the IPO was February 28, 2022.
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