Life Insurance Corporation of India shares fell 1.18% to ₹387.25 on Thursday following the closure of the government's record offer for sale, according to Zee News. The Offer for Sale (OFS) closed with oversubscription on both days, with the government successfully offloading 82.23 crore equity shares, equivalent to a 6.5% stake in the state-run insurer. The floor price was fixed at ₹382 per share, representing a discount of 10% to Monday's closing price. As per Zee News, the government exercised its entire green shoe option, taking the total stake sale to 6.5% of LIC's equity compared with the base offer size of 2.5%. The Department of Investment and Public Asset Management (DIPAM) stated that the OFS was oversubscribed on both days of bidding with 82.23 crore shares allocated to retail and institutional investors, with the transaction being India's largest public offering ever in terms of issue size.
The two-day OFS demonstrated robust investor participation across all categories. Non-retail investors bid for more than 94.45 crore shares at an indicative price of ₹383.84 per share, with bids valued at around ₹36,400 crore. The government later decided to exercise the oversubscription option for about 50.60 crore shares, representing 4% of LIC's paid-up equity share capital. In contrast, the retail category comprised 8.22 crore shares with subscription of only 69.43%, receiving bids for 5.71 crore shares against the total offering. The clearing price for non-retail investors was fixed at ₹383.10 per share, above the floor price of ₹382, while retail investors were allotted shares at ₹373.10 per share after a discount of ₹10. The OFS opened for non-retail investors on August 4, while retail investors bid on Wednesday, with the strong demand enabling the government to fully exercise the green shoe option and increase the offer size.
With the successful completion of the OFS, LIC's public shareholding has risen to 10%, achieving this critical milestone ahead of schedule, as confirmed by DIPAM Secretary in an X post. A total of 82.23 crore shares were allocated for ₹31,552 crore, making it India's largest public offering ever. The Secretary noted that "with this the public ownership of LIC has increased to 10 per cent and it has achieved this critical milestone ahead of schedule." The Department of Investment and Public Asset Management (DIPAM) thanked investors for their participation, saying the strong response reflected confidence in LIC and the government's disinvestment programme. The OFS consisted of a base offer of 31.62 crore equity shares and an additional 50.59 crore shares under the oversubscription option, with the offer opening first for institutional investors on August 4 and retail investors on August 5. This achievement helps India move ahead with its divestment programme targeting ₹80,000 crore through divestment and asset monetisation in FY27.
Life Insurance Corporation of India shares fell 8.24% to ₹393.20 on Tuesday following the government's announcement of a discounted stake sale, according to Business Standard. The government launched an offer to sell up to a 6.5% stake at a floor price of ₹382 per share, representing a discount of about 10.9% to Monday's closing price. This marks the first stake sale in LIC since the insurer's stock market debut in 2022, as reported by Reuters. With the sale of the entire 6.5% stake, the government will not face any deadline to sell further LIC shares and can time future divestment plans based on market conditions. The transaction also achieves the primary objective of raising public shareholding in LIC to 10%, a commitment made to SEBI at the time of its IPO when only a 3.5% stake was sold due to the size of the issue. LIC, India's largest life insurer, was listed on the stock exchanges in May 2022 after the government diluted a part of its stake through an initial public offering.
LIC is scheduled to announce its June quarter earnings on Thursday, with market expectations for strong performance. According to Kotak Institutional Equities, LIC is expected to report strong 44% year-on-year VNB growth in Q1 FY27, with APE growth estimated at 14% for the quarter. The brokerage firm estimates a massive 400 bps expansion in margins, reflecting a shift to high-margin non-par business. At 10:30 AM, LIC shares were trading lower at ₹387.25, hitting an intraday low on Thursday in early trade on the NSE, reflecting continued market uncertainty following the OFS closure. The successful completion of this record disinvestment transaction positions LIC well for future growth while supporting the government's broader divestment strategy.
