Government Reportedly Set to Unload $1 Billion Stake in LIC's OFS Next Month

India Aims to Raise Up to 100 Billion Rupees from LIC Share Sale

The Indian government is planning to initiate formal marketing for a share sale in the Life Insurance Corporation of India (LIC) next month, with the potential to raise as much as 100 billion rupees ($1 billion). The stake sale, which could take place in late June or early July, is expected to involve a 2% stake sale to institutional investors.

The Department of Investment and Public Asset Management, under the Finance Ministry, has enlisted the services of Goldman Sachs Group Inc., Motilal Oswal Investment Advisors Ltd., BNP Paribas SA, and IIFL Capital Services Ltd. to manage the transaction. The deliberations for the deal are ongoing, and details, including the timing and size, may still be subject to change.

The LIC share sale is expected to be one of the few sizable equity deals in India next month, amidst market concerns over the economic impact of the conflict in Iran. The escalating tensions have led to increased crude oil prices, causing concerns over India's import bill. In response, Prime Minister Narendra Modi has urged citizens to reduce fuel consumption and limit foreign travel.

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LIC's Recent History

In May 2022, the Indian government sold a 3.5% stake in LIC through an initial public offering (IPO), raising approximately 210 billion rupees. The shares were priced at 949 rupees each, marking the country's largest IPO at the time. As of March 31, the Indian government owned 96.5% of LIC.

LIC has been granted a 10-year window from its 2022 listing to meet the Securities and Exchange Board of India's minimum 25% public shareholding requirement, with the deadline set for May 2032.

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