The initial public offering (IPO) of Life Insurance Corporation (LIC) of India has been subscribed 1.92 times, with policyholders' quota already subscribed over 5 times. The employees' quota has been subscribed 3.83 times, while the retail individual investors (RIIs) portion subscribed around 1.62 times so far.
The non-institutional investors' segment has been subscribed 1.25 times while the qualified institutional buyers (QIBs) category, which comprises high net worth individuals and was not fully subscribed till yesterday, has been subscribed 1.07 times.
Despite a huge euphoria around the LIC IPO, the current market conditions seem to have taken a toll on the company's plan for mega subscriptions.
In the grey market, the LIC shares are commanding a premium of ₹36, which is significantly lower than ₹92 during the initial IPO filing process. Factors that are being attributed to the slow response, despite the government efforts, are believed to be sell-offs in the global market and overall weak sentiments in the wake of ket interest rate hikes across the world.
With the current grey market premium, the LIC IPO is expected to list at ₹985 per share (₹949+₹36), around a 3% premium from the cut-off price band. However, it must be noted that since the grey market premium is unofficial data, it does not suggest how the share will perform on a listing day. Around 18,95,25,165 bids were placed at cut off-price, and 30,89,44,470 bids were placed at the base price of ₹902.
The anchor portion was subscribed 77.41%, and the LIC was able to raise ₹4,355.9 crore by allocating 4.5 crore shares. There were a total of 5.92 crore shares on offer at the allocation price of ₹949 apiece.
The offer, which carries a price band of ₹902-949 apiece, is set to close on May 9. The share allotment for LIC IPO is expected to be done on May 12, while shares are likely to list on the BSE and the NSE on May 17. In an otherwise unusual move, the IPO issue will accept bids even on Saturday (May 7) and Sunday (May 8), shows a notification on the NSE. Analysts see this as a move to garner maximum investors in the country's biggest IPO to date.
The government aims to raise around ₹21,000 crore by selling a 3.5% stake in the company. The IPO is completely an offer for sale (OFS), which will see the government selling 22.13 crore (2,21,374,920) shares of ₹10 face value.
The company is offering a discount worth ₹45 per equity share to retail and eligible employee categories and ₹60 per equity share to the policyholder category. Bids can be placed for 15 equity shares and in multiples thereof, with a maximum subscription amount for retail investors, employees and policyholders at ₹2 lakh.