BackLIC listing drives govt's shareholding in NSE listed companies to record 7.15% in Q1
As per the latest report of Prime Database, the government's shareholding, as a promoter, in NSE listed companies climbed 7.15% in Q1FY23 compared to 5.48% in Q4FY22.
PremiumThe listing of the country's largest life insurer, LIC has pushed the government's holding in NSE listed companies to a high of 7.15% in the quarter ending June 30, 2022 (Q1FY23) compared to 5.48% in the March quarter. In value terms, the government's holding in NSE-listed companies has risen by 20.24% to ₹16.99 lakh crore in Q1 due to the LIC IPO issue. Notably, there has been a significant decline in the government's holding in listed companies on NSE for over a decade.
As per the latest report of Prime Database, the government's shareholding, as a promoter, in NSE listed companies climbed 7.15% in Q1FY23 compared to 5.48% in Q4FY22. In value terms, the holding has increased by 20.24% to ₹16.99 lakh crore primarily due to the LIC issue. The holding stood at ₹14.13 lakh crore in March 2022.
Pranav Haldea, the managing director of Prime Database Group, this was primarily on account of the ₹20,557-crore LIC IPO in May (which is only around a third of what was initially planned, selling only 3.5%), as reported by PTI.
LIC is currently the tenth largest company in terms of the market -- with a valuation of ₹4.29 lakh crore in Q1FY23. Although, LIC's market cap was more than ₹6 lakh crore prior to listing. LIC currently holds the title of largest issue in the Indian IPO market despite a heavy trim down in the size.
However, the overall shareholding of the government in the listed companies on NSE -- is way lower than Reliance Industries (RIL) which has a market valuation of around ₹17.63 lakh crore.
Data from Prime Database also revealed that, in the past 13 years, the share of government in NSE listed companies has plunged to 7.15% by end of June 2022 quarter from 22.48% in June 2009. This was due to divestment, lack of many new listings coupled with the lackluster performance of many central units relative to their private peers.
On the contrary, private promoters' shareholding dropped to 44.33% in Q1FY23 from 45.12% in Q4FY22. Since June 2009, the share of private promoters has increased steadily from 33.60%.
In value terms, private promoter holding has jumped more than seven-fold to ₹105.32 lakh crore in Q1FY23 from just ₹14.49 lakh crore in June 2009, mostly aided by new listings.
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