State-owned Life Insurance Corporation of India (LIC) said the Securities and Exchange Board of India (SEBI) had granted it an additional three years time, till May 2027, to comply with the minimum public shareholding norms, an announcement that saw the insurer’s shares vault more than 6% on Wednesday.
“The revised timeline for the Corporation to achieve 10% public shareholding is on or before May 16, 2027,” the insurer said in a filing.
SEBI’s decision, which effectively affords the government more time to decide on the next tranche of divestment in the insurer, also provides relief to investors wary of a bigger public float. Post LIC’s May 2022 IPO, the government of India owns 96.50% of the insurer.
SEBI’s communication of May 14 grants additional time of three years to achieve 10% public shareholding under Rule 19(2)(b)(iv) of the Securities Contracts (Regulation) Rules, 1957, i.e., within a period of 5 years from the date of listing, LIC said.
The decision follows the Department of Economic Affairs move in December 2023 to grant a one-time ‘public interest’ exemption to LIC to achieve 25% minimum public shareholding within 10 years.
LIC shares closed 6.31% higher on the BSE at ₹989.80 apiece on Wednesday.
The insurer got listed on the bourses on May 17, 2022. As per SEBI norms, LIC was required to achieve 10% public shareholding within two years of listing in the capital market. Over 22.13 crore shares, or a 3.5% stake in LIC, was sold through the IPO which fetched the government ₹20,557 crore. The price band of the issue was ₹902-949 a share.
(with PTI inputs)
