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According to a finance ministry official, the country’s largest insurer, LIC, is expected to file draft papers with Sebi by November for the country’s largest IPO ever.
“We plan to launch the IPO this fiscal year and have established rigorous deadlines. By November, the DRHP would be filed “an official told the news agency.
The government last month picked ten merchant bankers to manage the massive IPO including Goldman Sachs (India) Securities Pvt Ltd, Citigroup Global Markets India Pvt Ltd, and Nomura Financial Advisory and Securities (India) Pvt Ltd.
SBI Capital Markets Ltd, JM Financial Ltd, Axis Capital Ltd, BofA Securities, J P Morgan India Pvt Ltd, ICICI Securities Ltd, and Kotak Mahindra Capital Co Ltd are among the other shortlisted lenders.
By January, merchant bankers will perform worldwide and local road shows for investors after the draft red herring prospectus (DRHP) is submitted, according to the official.
The IPO’s legal advisor has been named Cyril Amarchand Mangaldas.
The government hopes to list the insurance behemoth before the end of the current fiscal year in March.
The ministry is currently estimating the life insurer’s inherent value, and after that is completed, the ministerial panel on disinvestment will make the final decision.
The government has sought the help of actuarial firm Milliman Advisors LLP India to calculate the LIC’s embedded value ahead of its IPO.
The government is also considering allowing foreign investors to buy shares in LIC, the country’s largest insurer. Foreign portfolio investors (FPIs) are allowed to buy shares in a public offering under Sebi rules. However, because the LIC Act makes no provision for international investments, the planned LIC IPO must comply with Sebi rules on foreign investor involvement.
The Cabinet Committee on Economic Affairs approved the Life Insurance Corporation of India’s initial public offering plan in July.
The government’s disinvestment objective of Rs 1.75 lakh crore for 2021-22 will be dependent on LIC’s listing (April-March).