INSUBCONTINENT EXCLUSIVE:
LIC IPO: Government files updated draft papers with Q3 financialsNew Delhi: The government has filed updated draft papers with market
regulator SEBI for an initial public offer (IPO) of Life Insurance Corporation (LIC), incorporating December quarter financials of the
insurance behemoth, an official said on Monday.In the run-up to the mega IPO, on February 13, the government had filed the draft red herring
prospectus (DRHP) with the regulator giving details of financial results till September
The DRHP got Sebi approval early this month."Updated DRHP of LIC with December financials has been filed," an official said, adding it was
required to be done as per Sebi observations.The Life Insurance Corporation reported a net profit of Rs 235 crore in the October-December
quarter as per the updated financials
The net profit in April-December, 2021 increased to Rs 1,671.57 crore from Rs 7.08 crore a year ago.The government is expecting to garner
over Rs 60,000 crore by selling about 31.6 crores or 5 per cent stake in the life insurance firm to meet the curtailed disinvestment target
of Rs 78,000 crore in the current fiscal.The IPO was initially planned to be launched in March, but the Russia-Ukraine crisis has derailed
the plans as stock markets are highly volatile.The government has time till May 12 to launch the IPO without filing new papers with India's
Securities and Exchange Board.LIC's embedded value, which measures the consolidated shareholders' value in an insurance company, was pegged
at about Rs 5.4 lakh crore as of September 30, 2021, by the international actuarial firm Milliman Advisors.Although the DRHP does not
disclose the market valuation of LIC, as per industry standards, it would be about three times the embedded value.At a 5 per cent stake
dilution, the LIC IPO would be the biggest ever in the history of the Indian stock market
Once listed, its market value would be comparable to top companies like RIL and TCS.So far, the amount mobilised from the IPO of Paytm in
2021 was the largest ever at Rs 18,300 crore, followed by Coal India (2010) at nearly Rs 15,500 crore and Reliance Power (2008) at Rs 11,700
crore.So far, Rs 12,423.67 crore has been garnered during the current financial year through offer for sale, employee OFS, strategic
disinvestment, and buyback
The target for the entire fiscal is Rs 78,000 crore.The disinvestment target has been set at Rs 65,000 crore for the next fiscal year.
