LIC, India’s public life insurance company which will be launching its initial public offering (IPO) through which the government may raise about Rs 1 lakh crore, but via two consecutive offerings with a gap of a few months.
It is believed that the market may not be able to absorb the entire issue of such a huge size. Besides, the other option that is being discussed is that cornerstone investors, marquee asset managers can add large funds ahead of the IPO, reported TOI.
“All the options are on the table (to make the LIC offer a success),” an official informed the publication.
The execution of this plan will be one of its own kind. So far, the SEBI rules mention that no promoters can dilute their stake to below 20% within 1.5 years of an IPO.
Officials also think that with many IPOs having already been done and many are yet to come, a large number of investors’ funds would already have been diverted to them, sources told TOI.
From January-July, over Rs 50,000 crore have been en route IPOs. The payment gateway app Paytm has also filed for an IPO to raise a whopping amount of Rs 16,600. Apart from this, Zomato made quite a buzz with Rs 1.3 billion. With many IPOs have finished and many in the pipeline, the officials find offering IPO in two parts should be a considerable option.