0

0

0

0

0

0

0

0

0

This article is more than 3 year old.

More than half of government proceeds from public sector IPOs, share sales since 2011-12 came from LIC

Mini

LIC has once again come to the rescue and may buy 43% stake in the state-owned IDBI Bank.

More than half of government proceeds from public sector IPOs, share sales since 2011-12 came from LIC
Life Insurance Corporation (LIC), the country's biggest insurance company with a 70% market share, often seems to be bailing out the government's disinvestment programs.
In fact, since 2011-12, LIC has invested in 26 out of 30 public sector initial public offering (IPOs) and offer for sale (OFS)  where the government was looking to divest their stake.
LIC has emerged as the single largest buyer of shares sold by the government in most of these companies, and half of the government divestment proceeds through these public sector issues came in from LIC.
The government raised around Rs.1,00,000 crore through these 30 public issues, and LIC’s total investment was around Rs. 56,000 crores.
For some of these public issues, LIC’s investment was as high as 80% of total government proceeds. For instance, government diluted ten percent stake in Indian Oil Corp. through an OFS in August 2015, and it raised more than Rs.9,500 crore. LIC alone invested around Rs.7,700 crore, 81% of the total government proceeds.
Similarly, in March this year, Hindustan Aeronautics raised around Rs. 4,000 crores through an IPO. 72% of the IPO proceeds came in from LIC. Even when General Insurance of India, country’s largest general insurance player got listed, LIC’s investment in the IPO was 58% of the total proceeds.
LIC has once again come to the rescue and may buy 43% stake in the state-owned IDBI Bank, as the government  looks to sell a majority stake in loss-hit IDBI Bank.
 
next story