In a big relief for Life Insurance Corporation of India (LIC), the Supreme Court on Thursday refused to postpone the pending IPO of the country’s largest insurer. LIC is likely to finalize the stock allotment of its mega IPO by the end of today.
Here’s your 10-point cheat sheet for this story:
“We cannot take interim measures in this case. More than 73 lakh applicants have already been registered on the IPO. This is a matter of investment and we cannot offer any relief,” said the highest court.
However, the court has notified the government of petitions challenging the constitutional validity of certain sections of the provisions of the Finance Act 2021 and LIC Act 1956, asking for a response within four weeks.
The decision was made by a bench of judges DY Chandrachud, Surya Kant and PS Narasimha.
The court heard a series of petitions filed against the LIC mega IPO. The petitioners contested the legality of the government’s decision to launch the LIC IPO through a money law.
The country’s largest-ever IPO was oversubscribed by 2.95 as six days of bidding came to an end on May 9.
The price range for the issuance was between Rs 902 and Rs 949 per share. LIC is likely to be listed on May 17.
The Center expects to raise up to Rs 21,000 crore – a third of its original target – through the sale of a 3.5 percent stake in the country’s largest insurer.
The 66-year-old company dominates the Indian insurance industry, with over 28 crore policies.
LIC was the world’s fifth largest insurer in terms of insurance premium collection in 2020, according to the latest year for which statistics are available.
Some gray market data revealed that the LIC shares would trade at Rs 15 below their issue price. However, policyholders and employees would still make a profit because they received discounts in the public offer.