Mumbai: Life Insurance Corporation of India (LIC) has asked all its policyholders to update their Permanent Account Number (PAN) details in their policy record to be eligible for participating in its upcoming public issue, according to the draft red herring prospectus (DRHP).
On February 13, the state-run insurer filed draft papers with capital market regulator Sebi for sale of 5 per cent stake by the government for an estimated Rs 63,000 crore.
The initial public offering (IPO) of over 31.6 crore shares or 5 per cent government stake is likely to hit the market in March and employees and policyholders of the insurance behemoth would get a discount over the floor price.
“A policyholder of our Corporation shall ensure that his / her PAN details are updated in the policy records of our Corporation at the earliest.
“A policyholder who has not updated his / her PAN details with our Corporation before expiry of two weeks from the date of the filing of this DRHP with SEBI (i.E., by February 28, 2022) shall not be considered as an Eligible Policyholder,” as per the DRHP.
The PAN updation can be done on LIC’s website either directly or with the help of agents.
It further said policyholders having one or more policies of LIC as on the date of the DRHP and bid / offer opening date and who are residents of India would be eligible to apply in this offer, under the Policyholder Reservation Portion.
The aggregate of reservation for eligible policyholders shall not exceed 10 per cent of the total offer size. The portion of the offer available for allocation to eligible policyholders on a proportionate basis is subject to the receipt of necessary approvals from the government.
LIC issued approximately 21 million individual policies in FY 2021, accounting for nearly 75 per cent of new individual policy issuances.
The IPO is offer for sale (OFS) by the Government of India. There is no fresh issue of shares by LIC. The government holds 100 per cent stake or over 632.49 crore shares in LIC. The face value of shares is Rs 10 apiece.
The LIC public issue would be the biggest IPO in the history of the Indian stock market. Once listed, LIC’s market valuation would be comparable to top companies like RIL and TCS.
The IPO of LIC is expected by March and the proceeds would be crucial to meet the revised disinvestment target of Rs 78,000 crore in the current fiscal.
LIC’s share capital was raised from Rs 100 crore to Rs 6,325 crore during September last year to help facilitate the IPO.
Last month, LIC reported a profit after tax of Rs 1,437 crore for the first half of the financial year 2021-22 as compared with Rs 6.14 crore in the year-ago period.
Its new business premium growth rate stood at 554.1 per cent in the first half of 2021-22, compared with 394.76 per cent during the year-ago period.
PTI
