LIC Shares Make Tepid Market Debut, List At 8.62% Discount

Shares of Life Insurance Corporation of India (LIC) made a tepid debut on Indian stock exchanges today. The Centre priced LIC's record-breaking initial public offering (IPO) last week at Rs 949, the top of the indicated range. It has raised around Rs 21,000 crore from selling a 3.5 per cent stake in the state-owned insurer.

Expert View
"As observed, the majority of big IPOs have not given strong listing debut gains. Considering previous trends, LIC has continued to take the same path with listing at a discount of over 8 per cent from 949 to 872 at NSE on its listing day. We believe that personal savings and awareness regarding insurance will increase enabling the sector to outperform in the long run and will indirectly benefit LIC as it is the market leader in this sector. We feel long term investors should continue to hold the scrip while short-term investors can wait to enter at a lower price," said Mohit Nigam, Head - PMS, Hem Securities.

Department of Investment and Public Asset Management (DIPAM) Secretary Tuhin Kanta Pandey on LIC's market debut
"This is a momentous event. LIC IPO is in line with the Prime Minister's vision. India is one of the most important emerging markets and it will be one of the fastest-growing economies in this decade. LIC Act was amended for the listing of IPO. Given the unprecedented size of the IPO special measures have been taken. Special drives were carried out to spread awareness for the policyholders. People enthusiastically participated and 73 lakh applications were received and possibly it is the largest in the world ever while 50 lakh demat accounts were opened since then."
As of 11:06 am, LIC shares were down 6.56 per cent at 886.75 over the issue price on the BSE index. On NSE, the stock was down 6.79 per cent at Rs 884.60.
LIC policyholders and retail investors have got the shares at a price of Rs 889 and Rs 904 apiece, respectively, after taking into account the discount offered.