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Details you don’t want to miss

Issue size

Upto Rs. 20,557 cr.

Issue Period

May 4 – May 9, 2022

Price band

Rs. 902 to Rs. 949

Market lot / Multiples

15 shares

Issue Timeline

Bidding period

May 4 – 9, 2022

Allotment

May 12, 2022

Refund Initiation

May 13, 2022

Share Crediting

May 16, 2022

Listing

May 17, 2022

Life Insurance Corporation of India (LIC) IPO Overview

LIC has been providing life insurance in India for more than 65 years and is the largest life insurer in India, with :
- 61.6% market share in terms of premium (or GWP),
- 61.4% market share in terms of new business premium (or NBP),
- 71.8% market share in terms of number of individual policies issued,
- 88.8% market share in terms of number of group policies issued for the nine months ended December 31, 2021, as well as by the number of individual agents, which comprised 55% of all individual agents in India as at December 31, 2021.

(Source: CRISIL Report, RHP)

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Strengths & Risks associated

Top 0 Strengths

  • 1

    Fifth largest life insurer globally by GWP and the largest player in the fast growing and underpenetrated Indian life insurance sector

    For FY21, LIC issued approximately 21 million individual policies in India, representing approximately 75% market share in new individual policy issuances. The second largest player in the industry issued 1.66 million individual policies and had a 5.9% market share for FY21. (Source: the CRISIL Report)

  • 2

    Trusted brand and a customer-centric business model

    The brand ‘LIC’ was recognised as the third strongest and 10th most valuable global insurance brand in 2021, as per the “Insurance 100 2021” report released by Brand Finance. As per the report, the brand value of LIC in 2021 was US$8,655 million, with a Brand Strength Index (BSI) score of 84.1 out of 100, corresponding to AAA- brand strength rating. (Source: DRHP)

  • 3

    Harnessing technology capabilities to support customer connect and drive operating efficiencies

    As at December 31, 2021, LIC's portal had 18.60 million registered users and the Corporation’s mobile app for policyholders, available on both Android and iOS platforms, had 5.1 million registered users. The Corporation’s uses three online on-boarding digital platforms through which intermediaries can register new proposals for insurance and issue new policies - e2e, i-proposals, AtmaNirbhar Agents New Business Digital App (""ANANDA"")

Top 0 risks

  • 1

    The ongoing COVID-19 pandemic could adversely affect all aspects of business

    These include (i) restricting the ability of agents to sell products; (ii) significantly increasing expenses due to changes in laws and regulations and investing in new methodologies to overcome the restrictions brought in to address the spread of COVID-19 and the adverse changes in population mortality/morbidity or utilization behaviours; (iii) adversely affecting the investment portfolio; (iv) adversely affecting operational effectiveness; and (v) heightening the general risks faced in the business (Source: DRHP).

  • 2

    Interest rate fluctuations may materially and adversely affect profitability

    In addition, the limited amounts and types of long-term fixed income products in the Indian capital markets and the legal and regulatory requirements on the types of investment and amount of investment assets that insurance entities are permitted to make could severely limit the ability to closely match the duration of assets and liabilities and thereby decrease interest rate risk. (Source: DRHP).

Financials

  • Net Worth
  • Total Income (Policyholders)
  • Total Income (Shareholder's Account)
  • Profit after tax
  • Total Borrowings

Net Worth

Total Income (Policyholders)

Total Income (Shareholder's Account)

Profit after tax

Total Borrowings

Industry Trends

LIC IPO FAQs

The IPO is set to open on May 4th and close on May 9th, 2022.

The LIC IPO comprises an offer for sale of 221.37 million shares.

The IPO comes with a price band of ₹902 to ₹949 per Equity Share.

A discount of Rs. 60 per share is being offered to eligible policyholders bidding in the Policyholder Reservation Portion. Thus, eligible policyholders can apply in the price range of Rs. 842 – Rs. 889

A discount of Rs. 45 per share is being offered to Retail Individual Bidders and also to eligible Employees. Thus, Retail bidders and Eligible employees can apply in price range of Rs. 857 – Rs. 904

One must compulsorily have two things to apply for the LIC IPO – a Demat Account and a PAN card. A Demat Account is needed to credit the shares if you receive an allotment. A PAN Card is essential for all IPOs so that the IT department can track the inflow and outflow of money for individuals.

LIC has stated that all policyholders have until 28th February 2022 to update their PAN card details on their website.

If you have multiple policies, then all policy numbers can be added. However, you can apply for the IPO only once, even if you have multiple policies.

Yes, the IPO is for everyone. Non-policyholders can apply under the retail investors or institutional investors category. However, you may not get the benefits that policyholders may get.

Yes, anyone with a valid PAN card and a Demat Account can apply for shares in IPO as an investor.

Since you are the owner of the policy and hence being a policyholder, you are eligible for reservation under the Policyholder Reservation Portion.

There is no lock-in period for shares allotted in the IPO. 

No, joint policyholders cannot apply individually for share allotment. Only one of the two holders can bid in the IPO under the Policyholder Reservation Portion. The other individuals can apply under the retail category with their PAN cards.

No, a policyholder using the Policyholder Reservation Portion to apply for the IPO needs to have their Demat Account to be eligible. If you do not have a Demat Account, you can open one with a valid Depository Participant

The maximum application amount under Policyholder category is Rs. 2,00,00

Yes. If you are an eligible policyholder (PAN linked on LIC portal by February 28, 2022), you can apply under both categories – Policyholder and Retail

If the policy is in the name of the Karta, application under policyholder category can be made

No, allotment is not guaranteed. Approximately 10 percent of the offer size is reserved for eligible policyholder(s). The allotment will be subject to competitive bidding (on similar lines as Retail Bidding) and will depend on the demand in the bidding process.

 No. Only Resident policyholders can apply in the policyholder category

No. Group policy members are not eligible for the policyholder quota

Subscription Status

Retail Individual Investor
Non-Institutional Investor
Qualified Institutional Buyers
Overall

Why invest in IPO through ICICIdirect

Paperless Applications

Hassle-free refunds

Convenient investments within a few clicks

Multiple modes of application

FAQs

An Initial Public Offering (IPO) is when a company issues common stock or shares to the public for the first time. It is the process where a privately held company becomes a publicly traded company with the initial sale of its stock. An IPO is a tool that companies use to secure capital through investments for future use. In most instances, this investment is used to expand or improve the business.

A price band is a price floor and a cap between which a seller will let buyers place bids on a security, usually during an initial public offering (IPO).

Minimum Order Quantity, as name says, is the minimum number of shares investors can apply while bidding in an IPO. If investors want to bid for more shares, they can apply in multiples of IPO market lot (lot Size or IPO bid lot) of shares.

If an investor wants to place bids for less than Rs.2 lacs, he needs to apply in the Retail segment. If an investor wants to bid for more than Rs.2 lacs, he needs to apply in the HNI segment.

Cut-off price is the offer price, finalized by a company in consultation with the book running lead managers (BRLMs), which could be any price within the price band. Applying on Cut-off price means the investor is ready to pay whatever price is decided by the company at the end of the book-building process.

When applying at a cut-off price, an investor has to pay the highest price while placing the bid. If a company decides the final price lower than the highest price asked for IPO, the remaining amount is returned to the retail investor.

An investor can apply in all Mainboard IPOs through ICICIdirect. However, if the investor wants to apply in SME IPOs, he/she can do it through the net banking portal of ICICI Bank.

ASBA stands for "Applications Supported by Blocked Accounts". At the time of bidding, investors’ account is blocked to the extent of the bid amount and debited only at the time of allotment. This facility is being offered by ICICIDirect in affiliation with ICICI Bank Limited.

In other payment options, the bid amount is debited when investors’ bid application is placed with the stock exchanges. Under the ASBA process, the amount will be debited from investors’ bank account to the extent of successful allotment at the time of allotment. Until such allotment, the amount will remain blocked in investors’ bank account.

Application under this facility can be placed only for Book Built Public Issues.

An investor can place maximum of 3 bids in an issue.

The investor with Demat account in ICICIdirect can apply in an IPO by logging in to his ICICIdirect Account. The investor needs to select IPO and then the name of the IPO in which he would like to apply. Given below is the path:

Login to ICICIdirect account >> IPO >> Name of IPO

Investor can apply in the retail section of an IPO through iDirect Portal even if he has a 2-in-1 account (Demat, Trading Accounts) with us and Bank account with third party.

Yes, the investor can revise or withdraw the bids after application. It can be done only once the order is executed. The investor needs to go to the IPO Order Book and select the Transaction Id and then click on Withdraw Application/ Revise Bid. The application in the non- institutional category cannot be withdrawn but can only be revised.

However, this needs to be done during the issue itself and cannot be done after the issue is closed. In case of ASBA applications, for upward revision of bid, additional lien will be marked to the extent of incremental amount. However, in case of downward revision, differential money blocked earlier will not be released. Such amount, if any, will be released after allotment

No, one person cannot apply multiple times with same Demat/PAN for an IPO. If an investor applies in an IPO though multiple applications with same Demat account or same PAN Number, his applications will be rejected.

If an investor would like to place order for multiple applications, he/she can apply with his/her family member's name. But, all eligible family members should have a Demat account and a PAN number.

In cases where issue is over-subscribed, bidding for more than 1 lot from the same account doesn’t help as maximum of only 1 lot can be provided against each application. However, if the investor applies for 1 lot from different accounts, the probability of allocation of shares increases.