LIC IPO: How Much Discount Will LIC Policyholders In LIC IPO Issue?

The IPO of LIC is slated to be launched on March 11 as per reports. For LIC policyholders there is presented a policyholder quota and for the same they will be entitled if they have one or more LIC policy as on the DRHP submission date i.e. February 13, 2022.

Further these LIC policyholders as per SEBI provided norms will be able to dole out some discount to the policyholders on the fixed price band.

Importantly, of the total OFS offer, 10% of the quota is reserved for policyholders and there are more anticipations on the discount that policyholders will get on the price band.

There is a view by stock market experts that under SEBI norms similar to employees, a company going public may also offer discount to LIC policyholders. As per them, LIC is allowed to give up to 10% discount on the price offer. Experts further said that they expect maximum 10% for LIC policyholders in the upcoming public issue by LIC.

Notably as per the SEBI rule, the discount can be even beyond 10 percent. Similarly Anuj Gupta's views; Avinash Gorakshkar, Head of Research at Profitmart Securities said, "As companies are allowed to offer discount on the price band to its employees, LIC can give discount to its policyholders and SEBI has provision for this. As the discount is capped at 10 per cent and LIC can't announce more than 10 per cent discount to its policyholders, I am expecting 10 per cent discount on offer price for LIC policyholders in upcoming public issue of the state-owned insurer."

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