LIC listing in FY21 H2 with 10% dilution

New Delhi: The government will list LIC in the second half of the next fiscal on the exchange with a minimum of 10 percent equity dilution which is the extract norm, a senior government official said on Sunday.

“The listing of LIC will be taking place in the second half of the next fiscal and the quantum will be as per extract norm which is minimum 10 percent,” Rajeev Kumar, Finance Secretary, told IANS in an interaction.

He said the exact timing, manner, and the quantum is to be decided. He, however, said the dilution could also include private equity players, with follow-on public offers as well. But as per norms, it cannot be less than 10 percent.

As per market regulator SEBI’s norms, all companies with a post-issue capital above Rs 4,000 crore are compulsorily required to offer at least a 10 percent stake in the IPO. Further, companies that dilute less than 25 percent in an IPO will be given three years to comply with the minimum public shareholding norms.

Kumar said without divulging the details on LIC listing that there will be a change in the Act to enable LIC to be listed on the market which will happen in due course and the law ministry is kept in the loop for the necessary legal changes.

On the IDBI Bank which LIC owns now with 51 percent and government with 46 percent stake, the Budget had announced that the government will fully exit IDBI Bank and it will be a private bank. The government exiting IDBI Bank may happen earlier than LIC listing, Kumar hinted.

In the Budget 2020, the government announced its decision to list LIC in the exchanges and together with government stake sales in financial institutions (banks), it is targeting to get Rs 90,000 crore as part of the huge disinvestment limit of Rs 2.10 lakh crore. He did not give a break-up of the LIC equity dilution portion from the Rs 90,000 crore target. LIC is the largest domestic financial institution in India with total investment assets of Rs 32 trillion as of September 30. (IANS)

Also Read: Government To Sell Part Of Its stake in LIC Via IPO: Union Budget 2020-21

Also Watch: NSUI unit in Guwahati demands immediate release of Youth Congress leaders