Relief for traders! Insurance behemoth LIC given 3-year time to achieve 10% public shareholding


The Life Insurance Corporation of India (LIC), a state-owned insurance coverage big, has introduced that it has acquired a three-year extension from the Securities and Exchange Board of India (Sebi) to adjust to minimal public shareholding norms.
In a regulatory submitting, LIC acknowledged, “Pursuant to Regulation 30 of Listing Regulations, this is to inform that Securities and Exchange Board of India (“SEBI”) vide its letter dated May 14, 2024 has conveyed its decision, to grant additional time of 3 years to Life Insurance Corporation of India (“the Corporation”) to achieve 10% public shareholding under Rule 19(2)(b)(iv) of the Securities Contracts (Regulation) Rules, 1957, i.e., within a period of 5 years from the date of listing.”
According to an ET report, the brand new deadline for LIC to achieve 10% public shareholding is May 16, 2027.This information brings reduction to traders because it postpones the potential for a provide overhang ensuing from a possible supply for sale (OFS) by the federal government to meet minimal public shareholding (MPS) norms. Consequently, LIC’s inventory value rose 3% to the day’s excessive of Rs 962.
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According to Sebi laws, all listed corporations should preserve a 25% public float. However, newly-listed corporations are given a three-year window to meet this requirement. For corporations with a post-issue market capitalisation exceeding Rs 1 lakh crore, the timeline to adjust to the 25% MPS rule is 5 years.
In December, the Finance Ministry had granted LIC an exemption from complying with the 25% MPS norms till 2032. Since then, the inventory has been on an upward trajectory. The Indian authorities, by means of the President of India, holds a 96.5% stake in LIC.
In May 2022, the federal government bought a 3.5% stake in LIC by means of an IPO, which was totally a proposal for sale (OFS) price roughly Rs 21,000 crore. It stays the biggest IPO in India to date, however the preliminary traders have barely made any income because the inventory is buying and selling solely barely greater than its situation value of Rs 949.
Over the previous yr, LIC shares have surged 69% due to numerous components, together with expectations of development revival in FY25 and the potential for a major enhance in dividends, that are anticipated to proceed supporting its share value efficiency.
LIC can be the biggest home institutional investor on Dalal Street, with its fairness investments valued at over Rs 14 lakh crore on the finish of the March quarter.

Nilesh Desai
Nilesh Desai
The Hindu Patrika is founded in 2016 by Mr. Nilesh Desai. This website is providing news and information mainly related to Hinduism. We appreciate if you send News, information or suggestion.


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