LIC granted 3-year time to achieve 10% public shareholding

The revised timeline for LIC to achieve 10% public shareholding is on or before May 16, 2027.

The news is a relief for as it delays the chances of a supply overhang coming in from a possible (OFS) by the government to meet minimum public shareholding (MPS) norms. As a result, the stock jumped 3% to the day's high of Rs 962.

Sebi rules mandate all listed companies to maintain 25% public float but newly-listed companies are granted a three-year window to fulfill the requirement. In the case of companies with a post-issue market capitalisation of more than Rs 1 lakh crore, the timeline to meet 25% MPS rule is for five years.

Back in December, the had granted the from complying with 25% till 2032. The stock has been rallying since then.

Through the President of India, the Indian government owns 96.5% stake in LIC.

In May 2022, the government had sold a 3.5% stake in LIC IPO which was an entirely (offer for sale) worth around Rs 21,000 crore. It remains India's largest IPO till date but the first batch of investors have hardly made money as the stock is trading marginally higher from its issue price of Rs 949.

In the last one year, however, LIC shares have jumped 69% on the back of multiple triggers including expectations of growth revival in FY25, and the possibility of a step change in dividend will continue to support its share price performance.

Being a government-owned entity, LIC has also been the topic of political discussions with Prime Minister Narendra Modi telling the Parliament in February that the Opposition used to spread 'bhootiya bangla' type fake stories on the insurance behemoth.

"They (Opposition) used to make all kinds of statements on LIC. They said all negative things about LIC. The trick is if you want to destroy someone, spread rumours and false stories. In a village, if someone has a big bungalow and someone else wants to acquire it, people spread rumours that it is a 'Bhootiya Bungalow' (haunted house). When nobody else buys, they buy it," PM Modi had told the House in February.

LIC is also the largest domestic institutional investor on Dalal Street with its equity investments valued over Rs 14 lakh crore at the end of the March quarter.