IPO-bound LIC urges policyholders to open Demat Accounts, Update PAN
If you are a LIC policyholder and intend to subscribe to the upcoming IPO, ensure that you have a Demat account. Also, please update your PAN on the LIC website and complete the KYC process explained by The Wealth Generating.
On 1 December 2021, the Life Insurance Corporation of India (LIC) issued a public notice in leading newspapers to this effect. The notice also mentions that there could be a special category for LIC policyholders in the upcoming IPO.
There has been a lot of buzz about the LIC IPO ever since the finance minister announced it in her Budget 2021 speech. According to reports, the IPO is expected to be issued in Q4 of FY22 and is likely to be India’s largest IPO so far.
Why is the LIC IPO important for the government?
The government currently owns a 95% stake in LIC and may divest anywhere between 5 to 6% of its stake based on its embedded value. Given the company’s mammoth size, the government may choose to divest a part of its stake in two separate public offerings.
In Budget 2021, the government laid out a disinvestment target of ₹1.75 lakh crore. As much as ₹1 lakh crore could be raised by selling government stakes in financial institutions, such as LIC and state-run banks.
If you’re a LIC policyholder, please update your PAN on the LIC website to ensure that you are compliant with KYC norms. Further, having a Demat account is a prerequisite to participate in an IPO, including the LIC IPO which is expected to be the country’s largest to date.