LIC mega IPO Updates: GMP, subscription status, other details

04:34:21 PM IST

Employee portion fully subscribed

As of 4:30 pm on Day 1 of LIC IPO, the issues was 0.6% subscribed. Here are the subscription status of different segments:

Qualified Institutional Buyers (QIBs)  - 0.33

Non Institutional Investors - 0.25

Retail Individual Investors (RIIs) - 0.54

Employee Reserved - 0.99

Policyholder Reserved - 1.80

04:30:12 PM IST

Subscribe to LIC IPO despite some headwinds: Geojit

“At the upper price band of 949, LIC is available at P/EVPS (Embedded Value Per Share) of 1.1x which is at a discount of 65% compared to the average valuation of private life insurance players. Even though headwinds like declining market share, lower short-term persistency ratios and sub-par margins demand a discount to private players, the current valuation is attractive considering its strong market presence, improvement in profitability due to changes in surplus distribution norms and strong sector growth outlook. Hence, we assign a “Subscribe" rating on a short to medium term basis," Geojit said in a note. 

03:57:17 PM IST

LIC reaches out to its policyholders via SMS

"LIC filed red herring prospectus(RHP) dt 26.4.22 with SEBI/Stock Exchanges for its IPO reserving shares for eligible policyholders. For details & risks in investing in LIC IPO and disclaimers, see RHP and links....," said the SMS sent by the insurer to the policyholders on their registered mobile numbers.  LIC has fixed the price band at Rs 902-949 per equity share for the issue. The offer includes a reservation for eligible employees and policyholders. The retail investors and eligible employees will also get a discount of Rs 45 per equity share and policyholders will get a discount of Rs 60 per share.

03:11:50 PM IST

LIC IPO subscription details

As of 3:10 pm, the issue was 0.47 times subscribed. Here the subscription details of different segments:

QIP - 0.03

Non Institutional Investors - 0.11

Retail Investors - 0.50

Employee - 0.84

Policyholder Reserved - 1.64 times

02:58:11 PM IST

RBI hike soured market sentiment on Day 1 of LIC IPO: Analyst

"The MPC's decision, in an unscheduled meeting, to raise the repo rate by 40bp and CRR by 50 bp is a surprise since it came on the LIC IPO opening date. MPC's proactive move is justified from the perspective of inflation management, but the timing leaves a lot to be desired. The above 1000 point crash in Sensex has soured the sentiments on the opening day of India's largest IPO. The 10-year bond yield has spiked to above 7.39% indicating an imminent rise in the cost of funds," VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services.

02:55:31 PM IST

Best advt for LIC is today’s market: Samir Arora

The RBI monetary policy committee in a off-cycle meet raised its repurchase rate by 40 basis points to 4.40%, It also raised the cash reserve ratio by 50 basis points. This led a a big slump in stock markets. “Best advt for LIC is today’s market: Anything can happen in life. Never forget about insurance," fund manger Samir Arora tweeted. 

02:28:51 PM IST

LIC IPO subscription details

As of 2:21 pm, the issue was 0.44 times subscribed. Here the subscription details of different segments: 

QIP - 0.03

Non Institutional Investors - 0.10

Retail Investors - 0.47

Employee - 0.77

Policyholder Reserved - 1.5 times

01:55:56 PM IST

How LIC share allotment will be done

Avinash Gorakshkar, Head of Research at Profitmart Securities said, "In retail category, share allotment will be done on the basis of draw of lots that means allottees will get lots through allotment or a minimum of 15 LIC shares if their application gets through the lucky draw. However, in the case of policyholders and employees category, all applicants will be given at least some share(s) on the proportionate basis that means here share allotment won't be done on the basis of lots. So, one should apply as much of lots as one can if it falls under the category of LIC policyholder and employees category. by doing this, they will be able to enhance their chances of getting more LIC shares."

01:17:01 PM IST

LIC IPO one-third subscribed in first three hours

As 1:10 pm, LIC  IPO was 0.35 times subscribed. The policyholder segment 1.23 times, employee 0.63 times, retail  0.38 times and non-institutional 0.08 times. 

12:41:26 PM IST

Possibility of downside in shares looks limited, says Samco

“From a valuation standpoint, at the upper band of the issue price, LIC is priced at 1.1x embedded value, which is at a significant discount to peers. Given the attractive valuation, the downside from here seems limited. Further the fact that a discount has also been offered to retail investors is the cherry on the cake. Taking into account all these factors, we have a SUBSCRIBE rating on this IPO," says Yesha Shah, Head of Equity Research, Samco Securities.

12:18:05 PM IST

GMP update

According to market observers, the GMP of LIC shares in grey market is around Rs 60- 65. 

12:07:47 PM IST

Subscription details

As of 12 noon, LIC IPO was 0.28 times subscribed while retail segment 0.31 times. The policyholder segment was nearly fully subscribed at 0.96 times and employee segment at 0.47 times. 

12:06:38 PM IST

Axis Securities sees potential of listing gains

In a note Axis Securities said: “Given the under-penetration of life insurance in India, the higher protection gap, and the improving financialization of savings, we expect LIC to maintain its market leadership position adequately supported by good business traction. Furthermore, LIC intends to increase its share of high-margin non-par products to improve its margins which will augur well for the company over the long term. Additionally, the company's NBP/APE growth has witnessed a strong rebound, enabling it to gain market share in Q4FY22. We believe LIC would trade at attractive valuations as at the upper end of the price band, the stock would trade at 1.1x market Cap/EV (H1FY22 embedded value) vs. the industry average of 3x."

11:20:23 AM IST

What makes LIC stand out from other life insurers?

In a note Axis Securities said: “The life insurance industry is capital intensive with a long gestation period, which has resulted in only a few players being active in the industry across most markets and the larger players within each market having a significant market share. However, nowhere in the world is the difference in market share between the largest and the second-largest life insurer as stark as in India, with the second-largest player having only 8.0% market share of GWP compared to LIC’s market share of 64.1% by GWP for FY21. LIC’s market share in India is unparalleled globally with no other life insurance player in any other country enjoying such a large market share."

11:01:35 AM IST

LIC IPO subscription off to brisk start

In the first hour of opening, the LIC issue was subscribed 0.12 times, with retail segment 0.18 times. 

10:47:02 AM IST

LIC IPO to stay open on Saturday for retail investors

The LIC IPO, which kicked off today, will remain open until May 9, including on Saturday, a notification on the National Stock Exchange of India Ltd. said, according to Bloomberg. The Indian government is selling 221.4 million LIC shares at between ?902 and ?949 each, which would raise as much as ?21000 crore at the top end of the range.

10:39:34 AM IST

LIC IPO related inflows could support rupee

“All focus will be on India's biggest IPO- LIC which opens today for the public. The anchor book worth 5,627 crore got an overwhelming response but the grey market suggests just an 8-10% premium. There could be a steady inflow on account of the same and could be a point for Rupee’s appreciation," CR Forex Advisors said in a note.