LIC said in a statement, this is a group insurance product and PMJJBY (Pradhan Mantri Jeevan Jyoti Bima Yojana) policyholders are not entitled to the exemption.
LIC policyholders are eligible to bid in the IPO.
IPO Bound Insurance Giants LIC ,Life Insurance Corporation) clarified on 22 February that the Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY) of the policyholder’s upcoming initial public offering (IPO) are not eligible for shares at discounted price. LIC said in a statement, it is a group insurance product and PMJJBY (Pradhan Mantri Jeevan Jyoti Bima Yojana) Policyholders are not entitled to the exemption. LIC has issued a clarification after the statement given by LIC Chairman MR Kumar. According to the draft Red Herring Prospectus (DRHP) filed last week, eligible policyholders of LIC will be given a reservation in the IPO, under which the maximum bid amount per person will not exceed Rs 2,00,000.
Let us tell you that LIC’s chairman said on Monday that PMJJBY customers are also eligible for the benefits available to policyholders in the IPO, a day after LIC clarified. However, LIC said in the statement that it was mentioned inadvertently.
To facilitate the IPO, the share capital of LIC was increased from Rs 100 crore to Rs 6,325 crore during September last year. The DRHP, filed with markets regulator SEBI on February 13, said the proposal is for sale of 5 per cent stake by the government for an estimated Rs 63,000 crore.
LIC policyholders will get discount
According to the DRHP, 35 per cent of the public offering will be reserved for retail investors, 5 per cent will be reserved for LIC employees while 10 per cent of the public offering will be reserved for its policyholders. Hence, an LIC policyholder will be able to apply in both retail as well as policyholder category.
LIC’s IPO is expected to come by March. Once listed, the market valuation of LIC will be at par with top companies like RIL and TCS.
LIC’s IPO in discussion in the market
Finance Minister Nirmala Sitharaman said that LIC’s IPO is in discussion in the market and investors are showing great interest in it. LIC’s IPO is going to be the biggest IPO of the country so far. The government has filed a draft document for LIC’s IPO with market regulator SEBI this month. The IPO is expected to hit the capital markets in March. Through this IPO, the government is offering five percent stake in LIC. Under this, the government will offer 316 million shares, which is equivalent to five percent stake.