Government opens to review of LIC IPO in the wake of Russian invasion of Ukraine
NEW DELHI:
The government is open to reviewing plans for the IPO of the state-run Life Insurance Corporation of India (LIC) this month, the finance minister said, in the wake of Russia’s invasion of Ukraine, which has impacted the world markets.
The government and management of LIC had launched virtual roadshows for India’s largest public stock exchange ever, aiming to float a 5 percent stake to raise about $8 billion this month.
“If global considerations warrant that I have to look at it, I wouldn’t mind looking at it again,” Finance Minister Nirmala Sitharaman told Business Line newspaper in an interview published Tuesday, citing the timing of the LIC listing.
Last Saturday, the federal cabinet approved a policy change that would allow foreign direct investment of up to 20 percent in LIC, a change aimed at facilitating the IPO of the state-run insurer.
Since Russia’s invasion of Ukraine last week, Indian markets, like other markets, have experienced volatility, with government officials fearing foreign and domestic investors are hesitant to buy shares of the insurance company.
The minister said the government ideally hoped to proceed with the listing as planned.
However, “now there is a full-scale war. That is why I have to go back and look at the situation,” Ms Sitharaman said.
She added that the pressure to meet revenue targets from the sale of government stakes in companies in the current fiscal year ending March 31 would not be a factor in determining the timing of the LIC listing.
“No, I don’t think that’s a factor…I have to explain it to the whole world,” she said.
