Expect LIC IPO soon, says FM
Published: Feb 01, 2020
By TIOLCORPLAWS News Service
NEW DELHI, FEB 01, 2020: FRESH from the trend of disinvestment of govt companies, the FinMin in Budget 2020-21, has today continued the vogue of raising funds from private players by offering the insurance behemoth LIC for partial IPO. Why partial? Because the Govt would want to continue its controlling stake in the LIC and offer part of its holdings to be listed in the exchanges. For current fiscal, the government has pegged disinvestment Rs 2.11 lakh crore which is twice as much as the last disinvestment target of Rs 1.05 crore.
Ms. Sitharaman, addressing the House has added that as part of decision to list the LIC, the government hopes to bring in more financial discipline among the enterprise. Thus, the government is not only hopeful to raise funding as part of its diinvestment strategy but also is hopeful to incorporate firm spending habits. Through this IPO, the LIC is likely to fetch huge premiums as currently it has a small equity base even though it enjoys the position of largest investor in government securities and stock in every FY.