Central Government is Planning for Larget IPO of Indian Stock Market (initial Public Offer) of Life Insurance Corporation of India (LIC) in March 2022. We have tried to cover each aspect of the LIC IPO related matters In this post.
There are 24 life insurance, 34 non-life insurance companies (including Standalone Health Insurance companies), one Reinsurance (RI) company in the Public Sector and ten RI branches in the private sector in the Indian insurance market. In India, the insurance penetration declined from a peak of 4.6% in 2009 to 2.5% in 2013. As of 2019, the insurance penetration in India was 3.76 per cent.
LIC has reserved 10% shares of IPO for Policyholders. To avail of the preferential allotment in LIC IPO, the following three conditions must be fulfilled.
- You must be a Policy Holder in LIC
- You have Linked your PAN with your Policy
- You have an active Demat account
LIC has started sending SMSes to its policyholders and publishing newspaper ads asking policyholders to ensure that their PAN card registration is done and the Demat accounts are active.
- You may visit the Corporation website www.licindia.in OR https://licindia.in/Home/Online-PAN-Registration Keep ready your Policy number, PAN, date of birth and e-mail id, Phone number which needs to be filled in while updating your PAN.
- You may update the records for all of your LIC policies using the above link.
- You can also check whether your Pan is registered in your policy or not by visiting the Corporations website www.licindia.in OR https://linkpan.licindia.in/UIDSeedingWebApp/getPolicyPANStatus?
- Alternately, you may contact your LIC Agent for updating the PAN.
- Recent photograph
- PAN Card
- Address Proof
- Cancelled cheque
The Authorised Share Capital of LIC post IPO will be Rs 25,000 crore made up of 2,500 crore shares of Rs 10 each. Of this, up to 10% of the LIC IPO issue size will be reserved for policyholders.
Facts about Life Insurance Corporation of India(LIC)
1. LIC policyholders: 25 crore
2. Number of Employees: Total 1.08 Lakh Female 25192
3. Agents of LIC: 13.53 Lakh
4. Offices in India: As of 31.03.2021, there were 8 Zonal Offices located in Mumbai, Delhi, Kolkata, Chennai, Hyderabad, Kanpur, Bhopal and Patna. There were 113 Divisional Offices, 2,048 Branch Offices, 1,546 Satellite Offices (SOs) and 1,173 Mini Offices.
- In terms of Gross premium written (GPW):64 %
- In terms of New Premium: 66.2 %
- In terms of the new Insurance policy: Individual:74 % Group: 81 %
9. Second Larget AUM SBI Life: 2.20 crore (SBI market cap 1.24 Lakh crore)
10. Assets Under Management under Mutual Fund in India: 31 lakh crore
11. LIC AUM is equal to 18% of the GDP of India
12. LIC has a share worth 4 % of NSE market Cap
13. Total Assets of LIC: 46 lakh crore
15. LIC is the fifth largest Company in Terms of Gross written premium in the World
16. LIC is the 10th largest Company in Terms of Total assets in the World
17. LIC is serving for the last 65 Years
18. Out of Total Business, more than 90% of LIC business, comes from Individual agents
19 Maturity Claim settled 2020-21:2.23 crore amounting to Rs 1.61 lakh crore (89.23%)
20. Grievance Resolution within 15 days: 98%
21. Death Claim Settled 2020-21:11.47 Lakh amt Rs 24.20 crore (98.27%)
22. Expected Growth in the LIfe insurance business is 18%
23. LIC is 3rd strongest brand in the world in Insurance after AIA and Dachi
24. Lic has also ownership in
- LIC Mutual Fund (AUM:1.57 Lakh crore), 49% share
- NPS and other Govt schemes: (AUM 1.63 Lakh crore)
- 45% in IDBI Bank
- 40% LIC Housing Finance
25. 10% shares of IPO is reserved for Policyholders
Valuation of IPO: Correct value will be known after the filing of the Draft Red Herring prospectus
Size of IPO: The size of IPO will be around Rs 50000 Crore to Rs 100000 crore
Equity dilution offered: 5% to 10%
Expected Valuation of LIC Post IPO: 10 lakh crore to 20 Lakh crore
Highest Market Cap company presently in India: Reliance (market cap 17 lakh crore)
India's largest IPO to date has been Paytm, which was of the size of about Rs 18,900 crore and was launched in November 2021. The next biggest Indian IPO was sized at Rs 15,475 crore and was by Coal India.
LIC AUM=36 lakh crore SBI AUM: 2.20 lakh crore SBI Valuation: 1.24 lakh crore
Based on SBI market cap of 1.24 lakh crore X 16(aum size) = value of LIC =20 Lakh crore
- 36*1.24/2.20= 20.29 Lakh crore