Shares of Life Insurance Company of India (LIC) will be in focus on Thursday, July 10, after government sources told CNBC-TV18 exclusively that there has been an approval granted for an Offer for Sale (OFS) for the company.India’s largest insurer as now been a public company for over three years but continues to lack free float in the market as the government continues to hold a majority stake.
As per the March quarter shareholding pattern, the government had a 96.5% stake in LIC, which is the same level since the company went public as the government had divested only 3.5% stake in the ₹21,000 crore LIC IPO back in 2022.
The government stake in LIC is 21.5% higher when compared to the Minimum Public Shareholding norms. That excess stake, based on the current market price, is valued at ₹1.28 lakh crore. This means, that for every 1% stake that the government divests in LIC, will fetch them close to ₹6,000 crore.Even within the 3.5% free float, 1.13% is held by mutual funds, while over 23 lakh retail shareholders, or those with authorised share capital of up to ₹2 lakh, have a 1.67% stake in the company.
As per the March quarter shareholding pattern, the government had a 96.5% stake in LIC, which is the same level since the company went public as the government had divested only 3.5% stake in the ₹21,000 crore LIC IPO back in 2022.
The government stake in LIC is 21.5% higher when compared to the Minimum Public Shareholding norms. That excess stake, based on the current market price, is valued at ₹1.28 lakh crore. This means, that for every 1% stake that the government divests in LIC, will fetch them close to ₹6,000 crore.Even within the 3.5% free float, 1.13% is held by mutual funds, while over 23 lakh retail shareholders, or those with authorised share capital of up to ₹2 lakh, have a 1.67% stake in the company.
In May last year, market regulator Securities and Exchange Board of India (SEBI) had granted LIC the approval to achieve 10% public shareholding by 2027.
Shares of LIC ended little changed on Wednesday at ₹946. The stock continues to trade around is IPO price of ₹949, having corrected from its recent 52-week high of ₹1,222. The stock is up 5.5% so far in 2025.
(OFS Newsbreak by Sapna Das.
