LIC IPO Coming Soon
Demat Account
29 Apr 2022
IPO Stands For Initial Public Offering
The process of issuing shares of a private firm to the public in a fresh stock issuance is known as an initial public offering (IPO). An initial public offering (IPO) allows a firm to raise funds from the general public. The move from a private to a public firm, which often involves a share premium for current private investors, can be a crucial opportunity for private investors to completely realize rewards from their investment. Meanwhile, public investors are allowed to participate in the offering.
Here are five things to consider about the LIC IPO:
- Following the IPO, LIC will be managed by a professional board of directors comprised of nine independent directors who have already been appointed. According to a PTI report, LIC managing director Siddhartha Mohanty stated that the chairmanship will be held until 2024, after which it will be replaced by the MD and CEO.
- The LIC, which has the greatest market share in India's life insurance market, has assets under management (AUM) of 40 lakh crore and reserves of 30 lakh crore, according to PTI.
- The government had previously proposed a 5% IPO size, but owing to market conditions, it was reduced to 3.5 percent last month.
- In September, the company's embedded value - a measure of consolidated shareholders' value in an insurance company - was assessed to be Rs.5.4 lakh crore. Milliman Advisors, an international actuarial firm, conducted the analysis.
- The LIC IPO is likely to contribute significantly to the government's disinvestment proceeds this fiscal year, or FY22. The government expected disinvestment receipts to reach $65,000 crore, up from $13,531 crore in the previous fiscal year.
Positive aspects that are important
- LIC is a corporation that sells both insurance and investment solutions. Their products combine insurance and investing to provide a guaranteed return.
- LIC has more than 13.5 lakh agents who bring in the majority of new business. LIC plans to provide 'set returns' as well as life insurance protection. This makes it simple for brokers to sell and gives insurers peace of mind.
- The public has a high level of trust in LIC for both life insurance and investing. In India, LIC stands for Life Insurance Corporation.
- LIC is in charge of assets worth Rs 39 lakh crores. That sum is greater than the whole mutual fund industry. These funds are split between stocks and bonds.