LIC IPO | A look at the journey of India’s leading insurance company
On February 13 LIC filed a draft red herring prospectus with Security Exchange Board of India (Sebi) to raise funds via initial public offering. The IPO consists of an offer for sale of upto 316.25 million shares or 5 percent stake by the government of India. The listing of LIC is poised to be India's biggest IPO to date. LIC continues to be the dominant life insurer even in the liberalised scenario of Indian insurance and is moving fast on a new growth trajectory surpassing its own past records
Life Insurance in its modern form came to India from England in the year 1818. Oriental Life Insurance Company started by Europeans in Calcutta was the first life insurance company on Indian Soil.
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The Parliament of India passed the Life Insurance Corporation Act on June 19, 1956 and on September 1, India’s leading insurance company LIC was formed with a capital contribution of Rs 5 crore from the Indian government. Over 245 insurance companies and provident fund societies were merged and nationalised to create the state-owned Life Insurance Corporation of India. (Image: Rajya Sabha)
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The nationalisation of the life insurance business in India was a result of the Industrial Policy Resolution of 1956, which had created a policy framework for extending state control over at least 17 sectors of the economy, including life insurance.
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India’s statutory insurance and investment corporation, is headquartered in Mumbai. Today LIC network comprises 113 divisional offices, 8 zonal offices, 2,048 branch offices, 1,546 satellite offices, 1,173 mini offices networked through wide area network with around 1.20 million agents across the country as on March 30, 2021.
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As of March 2020, LIC has more than 31 lakh crores worth of assets and has invested over Rs 2,82,000 crores in people’s welfare. Over the years, LIC has become a synonym for life insurance in India and a financial conglomerate.
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During the 2021 Union Budget, Finance Minister Nirmala Sitharaman announced a proposal to conduct an initial public offering for LIC. In year 2021, government of India had proposed to significantly enhance the authorised capital of Life Insurance Corporation of India (LIC), to ₹250 billion to facilitate its public listing scheduled for the next fiscal year.
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On February 13 LIC filed a draft red herring prospectus with Security Exchange Board of India (Sebi) to raise funds via initial public offering. The IPO consists of an offer for sale of upto 316.25 million shares or 5 percent stake by the government of India.
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From then to now, LIC has crossed many milestones and has set unprecedented performance records in various aspects of life insurance business and continues to be the dominant life insurer even in the liberalized scenario of Indian insurance.
