LIC shares sink 9% as OFS opens at 11% discount. Here's all you need to know
Shares of the Life Insurance Corporation of India (LIC) fell nearly 9% following the government's announcement of an offer for sale (OFS) at an 11% discount. The sale aims to increase public shareholding in the state-owned insurance giant.
Why it matters
As one of India's largest financial institutions, fluctuations in LIC stock significantly impact the broader Indian equity market and government divestment targets.
Shares of Life Insurance Corporation of India (LIC) tumbled nearly 9% on Tuesday as the government’s offer for sale to sell up to a 6.5% stake in the insurance behemoth opened for non-retail investors today.On Monday, LIC announced that the government plans to sell a 2.5% equity stake in the company as part of the base offer, with an additional 4% available as a green shoe option. The floor price for the OFS has been fixed at Rs 382 per share, implying nearly a 11% discount over the stock’s previous closing price of Rs 428.50 per share on NSE. The stock dropped to Rs 390.50 apiece on NSE on Tuesday morning.At the floor price, the total 82 crore shares available for the OFS, if the oversubscription option is availed, would be worth nearly Rs 31,410 crore.
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