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(Photo: Mint)
(Photo: Mint)

FinMin appoints Milliman Advisors for valuing LIC ahead of IPO

Govt plans to sell minority stake in the insurance behemoth and list it on the bourses. It has already appointed Deloitte and SBI Caps as pre-IPO transaction advisors

New Delhi: Finance Ministry has selected Milliman Advisors LLP India as the Reporting Actuary to derive the embedded value of Life Insurance Corporation (LIC) ahead of its IPO. DIPAM Secretary Tuhin Kanta Pandey said on Twitter on Thursday that work on this will start soon.

Embedded value is a common valuation measure used to estimate the consolidated value of shareholders' interest in an insurance company.

The government plans to sell minority stake in the insurance behemoth and list it on the bourses. It has already appointed Deloitte and SBI Caps as pre-IPO transaction advisors.

In the bid notice in November, the Department of Investment and Public Asset Management (DIPAM) said LIC needs to develop an Indian Embedded Value (IEV) reporting framework for necessary disclosures for the proposed Initial Public Offering (IPO).

The Request for Proposal had been issued to seek proposals / bids from reputed and eligible actuarial firms to work with LIC to "develop IEV in line with the requirements of the relevant Acts and regulations, Actuarial Practice Standards and guidance notes issued by the Institute of Actuaries of India and LIC Act, 1956, and to provide support during the IPO process", it said.

The government has budgeted to collect 2.10 lakh crore from stake sales this fiscal. This include 1.20 lakh crore from CPSE disinvestment and 90,000 crore from selling stake in financial institutions.

So far this fiscal, the government has been able to mop up 6,138 crore from CPSE disinvestment.

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