LIC may file draft papers for IPO in Dec; anchor investor talks likely next week

  • LIC IPO: A list with the names of about 100 global investors has been shared with the 10 banks working on the deal and the institutions will approach different sets of investors

Bloomberg
Updated16 Nov 2021, 04:03 PM IST
Once the embedded value of LIC is finalized, investment banks plan to file the draft IPO prospectus with the markets regulator
Once the embedded value of LIC is finalized, investment banks plan to file the draft IPO prospectus with the markets regulator(Reuters)

Bankers will start reaching out to potential anchor investors in the initial public offering of Life Insurance Corp. of India next week, as they seek to ensure there’s enough demand for what’s set to be the nation’s biggest share sale.  

A list with the names of about 100 global investors has been shared with the 10 banks working on the deal and the institutions will approach different sets of investors, according to people with knowledge of the matter who asked not to be named as discussions are private.

Banks plan to file the draft IPO prospectus with the markets regulator by the first week of December, once the embedded value of the firm is finalized, the people said.

A LIC representative didn’t immediately respond to an email seeking comment.

Prime Minister Narendra Modi is pushing ahead with LIC’s IPO -- which could raise between 400 billion rupees ($5.4 billion) and 1 trillion rupees to help plug a widening budget gap. India is seeking a valuation of between 8 trillion rupees and 10 trillion rupees and may sell a 5%-10% stake in the company as part of a broader divestment target. The government may also allow foreign direct investment in LIC to ensure a diversified and strong demand across various segments of investors. 

The discussions with possible investors will mark a crucial step to take the sale forward. Still, progress has been slow with the calculation of LIC’s embedded value, taking almost eight months so far. The embedded value is the key financial gauge for insurers which combines the current value of future profits with the net value of assets.

The government is pushing to get the IPO across the line by March and any delay won’t be due to a lack of political will, Finance Minister Nirmala Sitharaman said last month.

The government selected 10 banks, including Kotak Mahindra Bank Ltd., Goldman Sachs Group Inc., JPMorgan Chase & Co. and ICICI Securities Ltd., to arrange the sale.

Catch all the Budget News , Business News , Corporate news , Breaking News Events and Latest News Updates on Live Mint. Download The Mint News App to get Daily Market Updates.

MoreLess
First Published:16 Nov 2021, 04:03 PM IST
HomeCompaniesNewsLIC may file draft papers for IPO in Dec; anchor investor talks likely next week

Get Instant Loan up to ₹10 Lakh!

  • Employment Type

    Most Active Stocks

    Tata Steel

    160.30
    03:59 PM | 24 JUL 2024
    0.25 (0.16%)

    Bharat Electronics

    300.15
    03:52 PM | 24 JUL 2024
    -1.35 (-0.45%)

    NTPC

    392.55
    03:50 PM | 24 JUL 2024
    10.2 (2.67%)

    Federal Bank

    201.45
    03:58 PM | 24 JUL 2024
    3.45 (1.74%)
    More Active Stocks

    Market Snapshot

    • Top Gainers
    • Top Losers
    • 52 Week High

    Castrol India

    270.60
    03:56 PM | 24 JUL 2024
    24.05 (9.75%)

    HBL Power Systems

    648.35
    03:58 PM | 24 JUL 2024
    54.6 (9.2%)

    ICICI Prudential Life Insurance Company

    693.90
    03:49 PM | 24 JUL 2024
    56.3 (8.83%)

    Borosil Renewables

    560.70
    03:57 PM | 24 JUL 2024
    42.45 (8.19%)
    More from Top Gainers

    Recommended For You

      More Recommendations

      Gold Prices

      • 24K
      • 22K
      Bangalore
      71,412.00-3,783.00
      Chennai
      70,716.00-4,406.00
      Delhi
      70,716.00-4,332.00
      Kolkata
      70,716.00-4,845.00

      Fuel Price

      • Petrol
      • Diesel
      Bangalore
      102.86/L0.00
      Chennai
      100.78/L0.03
      Kolkata
      104.95/L0.00
      New Delhi
      94.72/L0.00
      OPEN IN APP
      HomeMarketsCibilPremiumBudget