Shares of Life Insurance Corporation of India (LIC), which recently raised Rs 20,557 crore through the country’s largest initial public offering (IPO), fell over 8% in their market debut on Tuesday, disappointing investors.
LIC, India’s largest insurance and domestic financial institution, began trading on the BSE for Rs 867.20, an 8.62 percent reduction to the issue price of Rs 949 per share. Even as the unpredictable stock markets staged a surge, with the Sensex soaring roughly 1,345 points, or 2.54%, the share concluded the day at Rs 875.45, a 7.75 percent discount.
After Reliance Industries, TCS, HDFC Bank, and Infosys, LIC presently has a market capitalization of roughly Rs 5.53 lakh crore, making it India’s fifth largest corporation by market capitalization.
“The markets were uneasy, so we weren’t expecting it to pick up… anticipate it to pick up.” I am certain that many policyholders who missed out on the IPO would now purchase LIC from the market. After the listing ceremony, LIC Chairman M R Kumar told reporters, “I don’t see why it should stay tepid for too long.”
While policyholders reacted positively to LIC’s initial public offering, international investors were less pleased. “This is due to global mood, which has put Indian investors to the test.” Could any other issue have accomplished this without FPIs, to put it another way? We received six (subscription) requests from policyholders. “That is enormous,” Kumar stated.
The total volume transacted was 27.55 lakh shares, with a delivery quantity percentage of 47.05 percent, according to the BSE. The NSE’s total volume traded was 487.92 lakh shares, with a delivery quantity percentage of 39.18%. On the first day, total turnover (BSE and NSE) was Rs 4,591.10 crore.
The shares were sold at Rs 889 and Rs 904 a share to LIC policyholders and retail investors, respectively. The first public offering ended on May 9, and shares were distributed to bidders on May 12. At a price range of Rs 902-949 a share, the government sold over 22.13 crore shares in LIC, representing a 3.5 percent ownership.
Retail investors and qualifying LIC personnel received a discount of Rs 45 per equity share above the issue price, whilst policyholders received a discount of Rs 60 per share.
The government received Rs20,557 crore from the share sale. The offer, which was nearly three times subscribed, was mostly taken up by retail and institutional purchasers, with little interest from overseas investors.
Due to the current market conditions, LIC lowered the size of its first public offering (IPO) from 5% to 3.5 percent last month. Even with the decreased value of about Rs 20,557 crore, the LIC IPO is the country’s largest ever.
