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The mega IPO of Life Insurance Corporation of India was fully subscribed on just its second day with strong response from policyholders, employees and retail investors.
According to data with exchanges, the issue was subscribed 1.03 times by 7 p.m. on Thursday. Bids were received for 16.68 crore shares against the 16.2 crore shares on offer.
Subscription so far
The policyholder quota was subscribed an overwhelming 3.11 times, while the portion reserved for employees was subscribed 2.22 times. The retail investor portion was subscribed 0.93 times. However, the non-institutional investor quota was subscribed just 0.47 times. The portion for qualified institutional investors saw little movement from the first day of the IPO and was subscribed 0.4 times.
Increased inflows are expected only on the last day, said a source. Foreign institutional investors have bid for just 225 shares in the IPO till now. The LIC IPO, which opened on May 4, will close on May 9.
Significantly, the issue will now remain open over the weekend including May 8 (Sunday) between 10 a.m. and 7 p.m. for bids.The RBIhas also announced thatall ASBA-designated bank branches will remain open for public on Sunday for processing IPO applications.
“The subscription opened on a positive response,” said Girirajan Murugan, CEO, FundsIndia, adding that the valuation of the IPO is attractive to keep the issue stable.Ahead of the IPO, the Centre had raised ₹5,627 crore from allocating 5.92 crore shares to anchor investors.
Moody’s Investor Service on Thursday said the LIC IPO is credit-positive for the country’s life insurance sector and will also benefit the insurer. “As a listed company,LICwill face more demanding disclosure requirements, resulting in increased transparency in its operations, and encouraging it to prioritise profitable underwriting and risk management. This will, in turn, boost its capacity to generate and grow capital internally,” it said.
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