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LIC IPO: India’s largest-ever issue subscribed 2.95 times on final day, all categories oversubscribed

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The Rs 21,000 crore public issue, the largest ever seen by domestic stock markets, opened for subscription last week and garnered heavy response with bids coming in for roughly 47.83 crore equity shares.

LIC (Life Insurance Corporation of India) IPO closed for subscription after a massive six-day window with investors bidding for 2.95 times the shares on offer. The Rs 21,000 crore public issue, the largest ever seen by domestic stock markets, opened for subscription last week and garnered heavy response with bids coming in for roughly 47.83 crore equity shares. Through the LIC IPO, the government has diluted its stake in the insurance sector behemoth by 3.5% and raised a large chunk of the divestment target for the current fiscal year. 

Qualified Institutional Buyers (QIB) were the last category to fully subscribe to their portion. At the end of the day, QIB portion was subscribed 2.83 times with bids coming in for 11.20 crore equity shares against the 3.95 crore on offer. Non-institutional investor (NII) portion was bid for 2.91 times. Data showed investors had bid for more than 8.61 crore equity shares while only 2.96 crore were reserved for the category. 

Retail investors subscribed to the issue in large numbers. Over the six-day subscription period, retail quota of LIC IPO was subscribed 1.99 times. Investors placed bids for 13.77 crore equity shares against the 6.91 crore that were on offer for retail investors. Employees of LIC subscribed to their reserved shares 4.40 times with bids coming in for more than 69 shares of LIC. 15.81 lakh shares were reserved for the category. Policyholders of LIC had oversubscribed their portion on the very first day of the issue and the final subscription figure stood at 6.12 times with bids coming in for 13.53 crore equity shares. 2.21 crore shares were reserved for policyholders.

LIC shares were offered to investors through the IPO in a fixed price band of Rs 902-949 per equity share. The offer included discounts for various investor categories. Retail investors and eligible employees got shares at a discount of Rs 45 per equity share, while policyholders were given a discount of Rs 60 per share. 

With its IPO, LIC has become the largest ever on Dalal Street, taking over from Paytm’s public issue that came last year. In 2021 Paytm had raised Rs 18,300 crore through the IPO, other large issues on Dalal Street include Coal India at nearly Rs 15,500 crore in 2020, and Reliance Power at Rs 11,700 crore which came in 2008. 

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