Indian govt approves LIC OFS: Sources

The Indian government has given its nod for an Offer for Sale (OFS) in Life Insurance Corporation of India (LIC), according to sources. Part of a broader disinvestment strategy this fiscal year, the move is aimed at raising retail participation and unlocking value in the public sector insurance behemoth.The government currently holds a 96.5% stake in LIC, with public shareholding at 3.5%. Given LIC’s market capitalisation of ₹5.98 lakh crore, every 1% stake sale could fetch the exchequer close to ₹6,000 crore.

The upcoming LIC OFS is expected to be one of the marquee transactions under the Centre’s disinvestment program for FY26. A

report by CNBC-TV18 in April had indicated that LIC was among the key public sector undertakings (PSUs) lined up for stake sales this year.
In an interview with CNBC-TV18, Arunish Chawla, Secretary of the Department of Investment and Public Asset Management (DIPAM), had confirmed the government’s intent to divest more in LIC.“Yes, we would. We would also share it with retail shareholders and policyholders. We want LIC to be part of every household in the country,” Chawla said.

He emphasised that the disinvestment strategy would remain flexible, adapting to market conditions.

LIC, which went public in 2022 with a 3.5% stake sale, currently trades at approximately 0.9 times its price-to-embedded value.

More details on the size, timing and structure of the LIC stake sale are expected to be shared in the coming weeks.