Finance Minister Reviews LIC IPO Progress Amid Third Wave Concerns


Finance Minister Nirmala Sitharaman reviewed progress in launching the initial public offering of Life Insurance Corporation of India (LIC) as the ongoing third wave of Covid-19 raises concerns about the rating of the insurer, which is presented as the most important in India.

The review was conducted with officials from the Department of Investment and Public Asset Management (DIPAM), Department of Financial Services (DFS), Insurance Regulatory and Development Authority of India (IRDAI) and LIC.

The insurer is looking to file the Draft Red Herring Prospectus (DRHP) with the Securities and Exchange Board of India (Sebi) this month, in line with the government’s plan to list the insurer on the stock exchange during of this exercise. The intrinsic value (EV) of LIC would also be disclosed in the DRHP. The government-appointed actuary, Milliman Advisors, has shared an EV project with the government and would soon share the final intrinsic value of LIC.

The Ministry of Finance and LIC recently approved a gradual decrease in the distributable surplus from the insurer to policyholders. Starting next year, LIC will distribute 92.5% of its surplus to policyholders, up from 95% currently, and gradually bring it back to the industry standard of 90%. The pie for shareholders, including the government, will gradually increase to 10 percent from the current 5 percent.

The government will also reserve part of the public offering for LIC employees and policyholders. The Center has reserved 10 percent of LIC’s initial public offering (IPO) award for policyholders. The insurer has also launched an advertising campaign for policyholders to encourage them to update their personal information with LIC and to open a demat account to participate in the listing and become shareholders of the largest insurer in the country.

Dear reader,

Business Standard has always strived to provide up-to-date information and commentary on developments that matter to you and have broader political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering has only strengthened our resolve and commitment to these ideals. Even in these difficult times resulting from Covid-19, we remain committed to keeping you informed and updated with credible news, authoritative views and cutting-edge commentary on relevant current issues.
However, we have a demand.

As we fight the economic impact of the pandemic, we need your support even more so that we can continue to provide you with more quality content. Our subscription model has received an encouraging response from many of you who have subscribed to our online content. More subscriptions to our online content can only help us achieve the goals of providing you with even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practice the journalism to which we are committed.

Support quality journalism and subscribe to Business Standard.

Digital editor


Source link

Previous Governor Newsom announces appointments 1.6.21
This is the most recent story.