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LIC shares fall after government OFS opens for non-retail investors

The government has set the OFS floor price at ₹382 per share and plans to sell a 2.5% stake via the offer, with an option to raise total sales to 6.5%.

Reported · Written up by our desk · Trade & Tariffs

Life Insurance Corporation of India shares dropped sharply after the government Offer for Sale opened for subscription to non-retail investors, with the stock falling as much as 8.28% on NSE. LIC shares opened at ₹392 versus a previous close of ₹428.50, and the stock hit an intraday low of ₹390.50 on August 4.

The government announced an OFS of a 2.5% stake in LIC on August 4, with an additional 4% available through a green shoe option. Non-retail investors can subscribe starting Tuesday, while retail investors are set to place bids on Wednesday, according to LiveMint Markets.

DIPAM set the floor price for the OFS at ₹382 per share, and said the sale is aimed at meeting minimum public shareholding milestones. If the green shoe option is fully subscribed, the government could sell up to 6.5% of LIC’s equity.

LiveMint Markets reported the government plans to sell more than 82.22 crore shares, which it expects could raise nearly ₹31,000 crore through the disinvestment program. The Centre currently holds about 96.5% of LIC, and the proposed OFS is expected to reduce that stake to 90%, aligning with an extended SEBI deadline to May 2027 for LIC to meet the MPS norm.

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