On Tuesday, India’s largest-ever IPO, state-owned insurance giant Life Insurance Corporation (LIC), launched its shares on the BSE and NSE at a discount of more than 8%.
Indeed, LIC began trading on the BSE at 867.20 per share, down 8.62 percent from its huge initial public offering (IPO) allotted price of 949.
As of 12:05 a.m. Indian Standard Time, the insurance behemoth’s shares were trading at around $890, up roughly 3% from its listing price but over 6% lower than its issue price (IST). In morning trading, the stock hit a high of 920.
“This is a momentous event. LIC IPO is in line with the Prime Minister’s vision. India is one of the most important emerging markets and will be one of the fastest-growing economies in this decade,” Tuhin Kanta Pandey, Secretary, Department of Investment and Public Asset Management (DIPAM), said at the LIC’s debut on the BSE, according to PTI.
“The LIC Act was amended for the listing of the IPO, and special measures were taken given the unprecedented size of the IPO,” he said. “Special drives were carried out to spread awareness for the policyholders, and people enthusiastically participated, and 73 lakh applications were received, a record, and possibly the largest in the world ever,” he added.
The NSE’s listing price for LIC was $872, representing an 8.11 percent decrease from the issue price. The stock was last trading at about 914 on the NSE, down nearly 3.5 percent.
“Despite the fact that the LIC stock has been listed at a lower price than the issue price of 949, given the attractive valuations and market stability, we expect some buying interest in the stock from both retail and intuitional investors.” “Motilal Oswal Financial Services’ Head of Equity Strategy, Broking and Distribution, Hemang Jani, stated.
“Because a huge amount of money was released following LIC’s listing, some of it could be redirected to equities markets,” he noted.
“This is a momentous event. LIC IPO is in line with the Prime Minister’s vision. India is one of the most important emerging markets and will be one of the fastest-growing economies in this decade,” Tuhin Kanta Pandey, Secretary, Department of Investment and Public Asset Management (DIPAM), said at the LIC’s debut on the BSE, according to PTI.
“The LIC Act was amended for the listing of the IPO, and special measures were taken given the unprecedented size of the IPO,” he said. “Special drives were carried out to spread awareness for the policyholders, and people enthusiastically participated, and 73 lakh applications were received, a record, and possibly the largest in the world ever,” he added.
Due to market volatility, the IPO was postponed until March and was reduced by a third of its initial target plan due to low demand.
The announcement comes as Indian equities indexes surged for the second day in a row on Tuesday, while the rupee fell to an all-time low.
After a successful issue that netted the government $20,557 crore, LIC set the issue price of its shares at $949 a share.
After taking into account the reduction, LIC policyholders and retail investors were able to purchase the shares for $889 and $904, respectively.
Through the IPO, the government sold approximately 22.13 crore shares, or 3.5 percent of LIC, achieving a third of its initial aim. The issue’s price range was 902-949 per share. On May 12, however, investors were given shares at the top of the price band.
