Government Raises ₹31,552 Crore Through LIC OFS

The government has successfully raised ₹31,552 crore through the Offer for Sale (OFS) of Life Insurance Corporation of India (LIC) shares. This move has increased LIC's public shareholding to 10%, meeting the Securities and Exchange Board of India (SEBI)'s minimum public shareholding requirement ahead of the deadline.

The OFS received strong demand from both retail and institutional investors, with a total of 82.23 crore shares allocated during the two-day offer. The Department of Investment and Public Asset Management (DIPAM) said the issue was the largest public offering in India's capital markets in terms of issue size.

The government had initially planned to sell a 2.5% stake in LIC, with a green shoe option to sell up to an additional 4% stake if investor demand remained strong. The floor price for the OFS was fixed at ₹382 per share. Due to strong demand, the government was able to fully exercise the green shoe option and increase the size of the offer.

Despite the successful OFS, LIC shares traded lower on Thursday, falling over 1% during early trading. The shares were trading at ₹387.25 on the NSE during the morning session.

The latest OFS further reduces the Centre's holding in LIC, while bringing the insurer in line with SEBI's public shareholding norms. LIC was listed on the stock exchanges in May 2022 after the government sold part of its stake through an initial public offering (IPO).

The government's decision to sell a stake in LIC is part of its disinvestment plan, aimed at raising funds for various development projects. The success of the OFS is expected to have a positive impact on the Indian capital markets, with investors showing strong interest in the country's largest insurer.

The increase in public shareholding is also expected to improve corporate governance and transparency in LIC. With a public shareholding of 10%, LIC is now in line with SEBI's norms, which require listed companies to have a minimum public shareholding of 10%.

The successful OFS is a significant development for the Indian insurance sector, with LIC being the country's largest insurer. The company's valuation is expected to increase, with its brand value already ranking 4th among India's top 10 most valuable brands, according to Brand Finance 2025.

In conclusion, the government's successful raising of ₹31,552 crore through the LIC OFS is a significant achievement, meeting the SEBI's public shareholding requirement ahead of the deadline. The move is expected to have a positive impact on the Indian capital markets and improve corporate governance in LIC.