Life Insurance Company (LIC)’s initial public offering (IPO) continued to receive strong interest from employees, policyholders, and retail investors. The offering was subscribed 1.78 times as of May 8, the fifth day of bidding. The country’s most extensive public offering was 2.907 billion shares, compared with 1.602 billion in this offering.

The portion reserved for retail investors was fully subscribed on the third day and was 1.59 times by the end of the fifth day. The offering received bids of 109 million shares from retail investors, of which 690 million were reserved shares. It is worth recalling that in 2008 Reliance Power received 4.8 million applications for its IPO. Fourteen years later, LIC broke that record with nearly 6 million applications from retail stock investors.

The LIC IPO opened for subscription on May 4 and will close on May 9. Bids for this offering are also open on Saturday and Sunday.
This IPO is divided into three parts:
• 50 per cent of the quota is reserved for qualified institutional investors (QIB)
• 35 per cent is reserved for non-institutional investors (NII)
• The remaining 15 per cent is reserved for individual retail investors (RII).
• A 10 per cent discount is also offered to policyholders.

The price range for the IPO was fixed at Rs 902 to 949 per share. LIC policyholders receive a discount of Rs 60 per share, while retail investors and eligible employees receive a discount of Rs 45 per share. The offering was entirely an offer to sell some 221.3 million shares held by the Indian government, which owns 100 per cent of the insurance giant but will only sell 3.5 per cent. By selling a 3.5 per cent stake in LIC, the government hopes to raise Rs 21,000 crore.

LIC lowered its IPO size from 5 per cent to 3.5 per cent due to volatile market conditions. Even with a small size of around Rs 20,557 crore, the LIC IPO is still the largest in the country. LIC has raised Rs 5,627 crore from lead investors by allocating 592,000 shares at Rs 949 per share.