Govt Sets the Ball Rolling for Mega Listing of LIC

The government has selected leading global and Indian merchant bankers among 10 that will manage the initial public offer of Life Insurance Corporation of India, which is being pegged as the largest public listing for the Indian markets.

The government has selected Goldman Sachs, JP Morgan, Citigroup, Nomura, Bank of America Securities, JM Financial, SBI Caps, Kotak Mahindra Capital, ICICI Securities and Axis Capital, according to a source aware of the development.

“Merchant bankers have been selected, the IPO is on track,” the source said, asking not to be named.

The government had said in its request for proposal issued last month that it will appoint 10 book running lead managers which will form a syndicate.

The selected bankers will submit book building of investors with likely volume and likely price based on latest interaction and response of the fund managers and will advise the department of investment and public asset management on the proper and optimum timing and best floor price for the IPO.

The merchant bankers will also structure the IPO, undertake due diligence activities and prepare the DRHP, conduct pre-market survey, road shows to generate interest amongst prospective investors and ensure optimum return.

While the roadshows are expected to begin as early as next month, the government is aiming to bring LIC’s IPO to the markets latest by March 2022. The proceeds from what is expected to be the largest public offer ever for the Indian markets, will be critical for the government to reach its disinvestment target of Rs 1.75 lakh crore set for the ongoing financial year.

Besides merchant bankers, the government has sought bids for appointing a legal adviser, advertising agency and registrar and share transfer agent for LIC’s public offer.

The department has said previously that the percentage of paid-up equity to be issued or divested as part of the IPO will be determined based on the post issue capital of LICI calculated in consonance with the clause 19 (2) of the Securities Contracts (Regulation) Rules, 1957.

“A part of the public offering may be reserved for employees and policyholders of LICI,” it had added.

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