Insurance

LIC IPO Listing: Tepid Response To India’s Biggest-Ever IPO: Lists Over 8% Lower

LIC IPO Listing: Tepid Response To India’s Biggest-Ever IPO: Lists Over 8% Lower
Written by Arindam

LIC Listing: LIC lists at 8.11% discount at Rs 872 per share on NSE

Life Insurance Corporation (LIC) lists on the BSE at Rs 867.20 per share, a discount of 8.62 per cent, or Rs 81.80, from its initial public offering (IPO) allotment price of Rs 949.

The insurance behemoth’s shares were last trading at Rs 904 as of 10.25 am Indian Standard Time (IST), a gain of over 4 per cent from its listing price of 867.20 and nearly 5 per cent lower than its issue price of Rs 949 per share.

On the NSE, the insurance behemoth’s listing price was Rs 872, indicating a discount of 8.11 per cent from issue price of Rs 949 per share. According to the NSE, the stock was last down 3.61 per cent, at Rs 914.75.

Indian equity benchmarks rose for a second consecutive session on Tuesday, with investors focused on the market debut of state-owned Life Insurance Corp, while the rupee weakened to an all-time low.

The listing comes when financial markets have been whiplashed on stagflation worries as major central banks are poised on an aggressive interest rate hike path to combat multi-decade high inflation. Emerging markets assets have taken a beating on foreign capital exodus driven by the dollar’s appeal on a general increase in flight-to-safety trades.

Despite wild gyrations in global financial markets, LIC’s IPO got an overwhelming response. The offer was oversubscribed nearly three times, led by policyholders who bid for over six times the shares on offer.

Indeed, the LIC IPO — India’s largest to date — closed with nearly 3 times subscription, predominantly lapped up by retail and institutional buyers, but foreign investor participation remained muted.

LIC had fixed the issue price of its shares at Rs 949 apiece after a successful initial public offering, which fetched Rs 20,557 crore to the government.

LIC policyholders and retail investors have got the shares at a price of Rs 889 and Rs 904 apiece, respectively, after taking into account the discount offered.  The shares got listed on the BSE and NSE on Tuesday at a discount of Rs 81.80 and Rs 77 apiece, respectively, over its issue price of Rs 949 a share.

The government sold over 22.13 crore shares or a 3.5 per cent stake in LIC through the IPO. The price band of the issue was Rs 902-949 a share. However, shares were allocated to investors on May 12 at the upper end of the price band.

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Arindam

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