Much-awaited LIC IPO to hit market on May 4, close on May 9: Sources

• According to the revised DRHP, the government has also slashed the issue size from 5 percent to 3.5 percent
• LIC's board is expected to meet this week and finalise the price band for the IPO

New Delhi: The much-awaited Initial Public Offer (IPO) of Life Insurance Corporation (LIC) is likely to hit the market on May 4, said sources close to the development on Monday. The issue is expected to close on May 9 and the anchor book for the LIC IPO is expected to open on May 2, they added. The Securities and Exchange Board of India (SEBI) has already given its nod to the revised Draft Red Herring Prospectus (DRHP). According to the revised DRHP, the government has also slashed the issue size from 5 percent to 3.5 percent, as was speculated earlier.

IPO: LIC Board to finalise price bank this week

According to sources, the LIC's board is expected to meet this week and finalise the price band for the IPO. The red herring prospectus will be submitted to SEBI by April 27. By offloading 3.5 percent shares, the government will be looking to raise Rs 21,000 crore. The figure indicates that the government is targeting a valuation of Rs 6 trillion for LIC. 

Background

The LIC IPO is most crucial for the government to meet its disinvestment target of Rs 65,000 crore for the current financial year, especially as the privatisation of Bharat Petroleum Corporation Ltd (BPCL) seems to be on the backburner for now. The government had earlier filed the DRHP for LIC IPO in February and was planning to offload 5 percent shares. However, with Russia's invasion of Ukraine, the government had to delay the plan as the market faced volatility.

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