Life Insurance coverage Company of India (LIC), which is anticipated to listing subsequent week on Might 17, 2022 might even see a tepid inventory market debut, as per the gray market indications the place its shares have slipped to low cost from premium.
As per market observers, LIC shares are buying and selling at a reduction within the vary of ₹8-15 within the gray market at the moment, down from ₹85 premium (GMP) at the beginning of the month. The gray market low cost signifies that LIC shares might have a reasonable to discounted itemizing.
LIC’s mega public providing closed with practically 3 instances subscription on the finish of the six-day bidding interval which ended on Monday, predominately lapped up by home retail and institutional consumers however international investor participation remained muted. The insurance coverage behemoth had mounted the worth band at ₹902-949 per fairness share for the difficulty.
Buyers are additionally involved about LIC’s capability to maintain market share as personal insurers like HDFC Life Insurance coverage Co. and SBI Life Insurance coverage Co. broaden. The personal sector has been on an aggressive growth spree throughout the pandemic, rising new particular person coverage premiums whereas LIC struggled.
The federal government has raised ₹20,500 crore from sale of three.5% of its stake within the insurance coverage behemoth. LIC diminished its IPO measurement from 5% to three.5% because of the prevailing uneven market situations, which was considerably decrease than the sooner projection of about ₹60,000 crore.
The anchor investor portion of the insurance coverage behemoth’s preliminary share sale was oversubscribed final week, elevating round ₹5,620 crore from anchor traders, forward of its difficulty.
LIC was fashioned by merging and nationalising 245 personal life insurance coverage firms on September 1, 1956. As of December 2021, LIC had a market share of 61.6% by way of premiums or GWP, 61.4% by way of new enterprise premium, 71.8% by way of the variety of particular person insurance policies issued, and 88.8% by way of the variety of group insurance policies issued.
Supply: Live Mint