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Domestic investors were predominantly responsible for the success of the LIC IPO said Tuhin Kanta Pandey, secretary of the department of investment and public asset management (DIPAM) on Monday after the IPO closed with 2.95 times subscription.   

He added that the success of the IPO showed that India’s capital markets and investors had capacity to pull off a massive IPO like LIC even as most FIIs largely remained away from the mega listing. 

“FIIs take their own call like all other investors. I think we should look at it from a positive angle that this issue is an example of Atmanirbhar Bharat – that a big issue has been pulled off by India. The retail investors interest shows that we, our capital markets and investors’ capacities have increased a lot such that we need not be totally dependent on FIIs to run the market. They’re equally welcome and some have come, but its true that predominantly, this issue has been domestically lifted," he said.

He noted that the LIC IPO met with ‘tremendous success from all categories of investors, retail, policyholders as well as QIPs and NIIs.’

The LIC IPO saw a total subscription at 2.95 times on closing day May 9, after being open for a longer window of six days. According to data from exchanges, retail investors portion was subscribed 1.99 times, while employees portion was subscribed 4.39 times and policyholders had subscribed for their portion of shares by 6.11 times. The IPO saw a sliver of foreign institutional investors participating amid geo-political uncertainties and stock market volatilities. 

Department of financial services Sanjay Malhotra said that the inflow of investor money into LIC amid outflow of FIIs spoke volumes of LIC as a company. 

“So the other way to look at it is that there have been net FII outflows on one hand and on the other hand, we have an inflow. So despite there being in outflows, there is an inflow and there is an investment for LIC which speaks of, of LIC as a company,’ he said. 

Pandey further noted that the long exercise for listing of LIC will not only deepen capital markets but facilitate a large number of investors into a publicly owned company in the form of shares of LIC. 

DIPAM joint secretary Alok Pande said that while the issue size was 21,000 crore, the actual proceeds could be about 20,500 crore after taking into account the discounts given to retail investors. 

On a question on whether LIC would be included in the Indian market indices from day one since it was the biggest IPO in stock markets or even be included in some foreign indices, Pandey said that while the stock would be eventually included in the indices, it will have to follow all procedures and meet minimum requirements in terms of float and size before it is included. 

The government plans to allocate the shares on May 12 and list the company on May 17, Pandey said, adding that the government had facilitated investors to the best extent possible, “Let us hope all goes well on listing day," he added. 

Pandey added that the size of the IPO was decided after taking into consideration the overall situation and with geo-political uncertainties the investment pool gets reduced.

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