LIC IPO Details: Price Band, Lot Size, Issue Size, Financials, Strength, and Analysis
Life Insurance Corporation (LIC) is India’s largest insurance provider company which is under the ownership of govt. of India. The Life insurance corporation of India was established on 1 September 1956, when the Parliament of India passed the Life Insurance of India Act which nationalized the insurance industry in India. Over 245 insurance companies and provident societies were merged to create India’s state-owned Life Insurance Corporation.
As of 30 Sep 2021, it has a total AUM of Rs. 39 lakh crore. LIC operates through 2048 branches, 113 divisional offices, and 1,554 Satellite Offices. It operates globally in Fiji, Mauritius, Bangladesh, Nepal, Singapore, Sri Lanka, UAE, Bahrain, Qatar, Kuwait, and the United Kingdom.
LIC IPO Details –
LIC IPO Issue Size –
| Public Issue | Amount in INR |
|---|---|
| Total Issue Size | ₹ 21,008.48 Crore |
| Offer for Sale | ₹ 21,008.48 Crore |
LIC IPO Lot Size –
| Lots | Shares | Total Amount |
|---|---|---|
| Minimum Lot – 1 | 15 | ₹ 14,235 |
| Maximum Lot – 14 | 210 | ₹ 199,290 |
The minimum lot size of LIC IPO is 15 shares, and retail/individual investors can apply up to 14 lots (210 shares at an amount of ₹ 199,290).
LIC Details –
| IPO Price | ₹ 902 to ₹ 949 per equity share |
| Face Value | ₹ 10 per equity share |
The government is looking for a valuation of around Rs 6 lakh crore in the IPO.
LIC IPO Price by Category
| Investor Category | Effective Price |
|---|---|
| Policyholders | Rs 889 (Rs 45 discount) |
| Retail | Rs 904 (Rs 45 discount) |
| QIBs | Rs 949 |
| HNIs | Rs 949 |
LIC IPO Dates –
The bidding time for applying for IPO is 10 AM to 5 PM.
| IPO Open Date | 04 May 2022 |
| IPO Close Date | 09 May 2022 |
| IPO Allotment Date | 12 May 2022 |
| Amount Refund Date | 16 May 2022 |
| Shares credit to Demat Account | 16 May 2022 |
| IPO Listing Date | 17 May 2022 |
Shares Reserved for Category –
| Qualified International Buyer (QIB) | 50 % |
| Non-institutional investors (NII) | 15 % |
| Retail Investors (RI) / Individual | 35 % |
The objective of the Issue –
LIC will utilize the net proceeds from the IPO for –
- The government aims to get 21,000 crores by offloading 3.5% of its shares.
- To achieve the benefits of listings the equity shares on the stock exchange.
- To carry out an offer for sale of 316,249,885 shares by selling shareholders.
LIC Financials –
The Life Insurance Corporation (LIC) reported a profit of ₹ 2,974 crores in the financial year 2021 over a profit of ₹ 2,710 crores in the previous financial year 2020. Revenue increased by ₹ 2,986 Crores (in FY21) from ₹ 2,731 Crores (in FY20), and the total assets of the company also increased from ₹3,414,174 crores (in FY 2020) to ₹3,746,404 crores in FY2021.
| FY20 (Cr.) | FY21 | 9M FY22 | |
|---|---|---|---|
| Net Profit | ₹ 2,710 | ₹ 2,974 | ₹ 1,715 |
| Net Premium | ₹ 382,475 | ₹ 405,398 | ₹ 285,341 |
| Total Assets | ₹ 3,414,174 | ₹ 3,746,404 | ₹ 4,090,786 |
LIC Promotor and Management –
The government of India is the company promoter.
- It is currently 100% owned by the government.
LIC Pre-issue shareholding is 100% after IPO shareholding will be 96.50%.
The Government of India aims to unship 3.5% of its holding in the insurance giant.
Company Strengths –
LIC is a part insurance and part investment products company. Their plans are a combination of insurance and investment with a guaranteed return.
LIC has over 13.5 lakh agents who play bringing most of the new business. LIC plans offer ‘fixed returns’ along with life insurance coverage. This makes it easy to sell by agents and brings peace of mind to the insurers.
LIC has high trust in the public for both life insurance and investment done with them. LIC is synonymous with insurance in India.
LIC manage asset of Rs 39 lakh crores. That is more money than the entire mutual fund industry combined. They invest these funds across stocks and bonds. They own 4% of all listed stocks in India and more government bonds than the RBI.
Leading insurance provider company in India and fifth largest global insurer by GWP.
A range of life insurance products to meet the varied insurance needs of individuals.
Global Co-ordinators and Book Running Lead Managers
- SBI Capital Markets Ltd.
- HDFC Bank Ltd.
- J.P. Morgan India Pvt. Ltd.
- BofA Securities India Ltd.
- Goldman Sachs (India) Securities Pvt. Ltd.
- ICICI Securities Limited
- JM Financial Consultants Pvt. Ltd.
- Citigroup Global Markets India Pvt. Ltd.
- Kotak Mahindra Capital Ltd.
- Nomura Financial Advisory and Securities (India) Pvt. Ltd.
LIC IPO Registrar –
KFin Technologies Ltd.
LIC IPO GMP Rates (Grey Market Premium)
| Date | GMP |
|---|---|
| 13 May | ₹ +- 10 |
| 10 May | ₹ 30 |
| 07 May | ₹ 60 |
| 05 May | ₹ 65 |
LIC IPO’s expected return is _ %
The IPO of the largest insurance company in India LIC proposed to be listed on BSE and NSE, and the company has received approval from BSE and NSE for the listing of the equity shares.
LIC IPO Subscription Status –
LIC IPO is subscribed – on May 07, 2022.
| Category | Subscription (Times) |
|---|---|
| Qualified Institutional Buyers (QIB) | _ 2.83x |
| Non-Institutional Investors (NII) | _ 2.91x |
| Retail Individual Investors (RII) | _ 1.97x |
| Employees | _ 4.36x |
| Policyholders | _ 6.06x |
| Total | _ 1.52x |
