After rolling out the initial public offer (IPO) of Life Insurance Corp (LIC), the government may privatise one of its general insurance companies this year, reported Mint.
The government will start work to identify one of its three general insurers—National Insurance Co, United India Insurance Co and Oriental India Insurance—for privatisation and start work towards the selloff after their first-quarter earnings are out, and by then, LIC will be listed on the stock exchanges, according to the report.
Also Read: LIC IPO | Offer subscribed 1.38 times on day 3, investors pour in Rs 20,269 crore so far
United India Insurance reported a loss of Rs 1,485 crore in 2019-20, but the insurer is considered the best candidate for privatisation due to its nationwide presence and solid market share in various insurance categories. Its losses lowered to Rs 985 crore in FY21, and is likely to have further narrowed in FY22.
Moneycontrol could not independently verify the report.
Government think tank NITI Aayog is likely to recommend United India Insurance for privatisation to a core group of secretaries on disinvestment, however, the name is yet to be finalised. A group of ministers (GoM) will take the final call on the candidate for privatisation.
Earlier, the government had considered merging National Insurance, United India Insurance and Oriental India Insurance into a single entity and subsequently listing it on stock exchanges. But in 2020, the government infused Rs 12,450 crore in them, betting on their profitable growth as independent entities.
The LIC IPO, meanwhile, continued to receive a healthy response from investors as the offer garnered another Rs 5,000 crore worth of bids. Investors have poured Rs 20,269 crore into the country's largest-ever public issue in the first three days of the launch of the offer.
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