The much-anticipated LIC IPO has been approved by market regulator Sebi, according to ET NOW. Sebi has issued an observation letter in this regard, according to the article. The application was approved in just 22 days.
LIC had submitted its draft papers to the market regulator in February 2022. The government, which owns a 100% stake in the insurance behemoth, will be selling 31,62,49,885 equity shares in the issue.
According to the DRHP, the issue will have reservations for eligible employees and policyholders of LIC.
According to reports, the government may postpone the massive offering until the next fiscal year due to increased market volatility as a result of the ongoing Russia-Ukraine conflict.
According to the LIC DRHP filed with SEBI, a policyholder who has not updated his or her PAN before February 28, 2022 will not be ineligible to invest in the LIC IPO under the amount reserved for policyholders.
Here are important FAQs to note according to DRHP
1) Is it necessary for policyholders to have a demat account to apply for shares in the Offer?
Yes. As per SEBI ICDR Regulations, no equity share can be issued by any company in physical form and the equity shares can only be issued in dematerialized form. Hence, any one, whether policyholders or retail investors, should have a demat account for applying in the offer.
2) Is there any lock-in period for the shares purchased through the Policyholder Reservation Portion?
There is no lock-in period and the policyholders can sell the Equity Shares immediately on listing of the Equity Shares, if they choose to do so.
3) Is there any minimum number of Equity Shares for which the policyholders need to apply?
There is a minimum number of Equity Shares (x) which will have to be applied under the Offer in respect of all categories. Hence, Eligible Policyholder(s) also have to apply for the said minimum x number of Equity Shares, as specified in the Offer Documents.
4) How much is the discount for Eligible Policyholder(s) under Offer?
Eligible Policyholder(s) are offered a discount of Rs Z per Equity Share. In case, the Offer Price (the price at which shares are allotted to retail and other investors) is Rs X, Eligible Policyholder(s) will be allotted Equity Shares at Rs (X-Z) per Equity Share.
5) I have a joint life policy. Whether I and my spouse both will be eligible for reservation or not?
Only one of the two can apply for the Equity Shares under the Policyholder Reservation Portion category. The PAN number of the applicant Bidding in the Offer (you or your spouse) needs to be updated in the policy records. The applicant has to have a demat account in his/ her name and in case the demat account is joint, the applicant needs to be the first /primary holder of the demat account.
6) I am having a policy of the Corporation which is in lapsed condition. Am I eligible for reservation under the Policyholder Reservation Portion?
All policies which have not exited our records by way of maturity, surrender or by way of death of the policyholder are eligible for reservation under the Policyholder Reservation Portion.
7) How can I link my PAN to my policy?
The easiest option is through the option made available on the website of our Corporation for updating the PAN. You need to have your PAN number, policy number, mobile number and email ID and through a very simple process, your PAN number will be updated. You may also approach our offices wherein the PAN number can be updated.
8) I am having a Pradhan Mantri Vaya Vandana Yojana policy. Whether I am eligible to apply for the Equity Shares of the Corporation in the Offer?
Yes, all policies other than group policies qualify for Bidding in the Policyholder Reservation Portion.
9) Whether NRI policyholders or other policyholders residing out of India can apply in the Offer?
No, only resident Indians can apply.
10) Can senior citizens apply in the Offer or any age restrictions?
No, there is no age restriction. All Eligible Policyholder(s) on the date of this Draft Red Herring Prospectus and the policy continuing without exit on the Bid/Offer Opening Date are eligible to apply in the Offer.
11) Is there any condition of minimum premium or sum assured to be eligible for Bidding under the Policyholder Reservation Portion?
No such condition. All Eligible Policyholder(s), subject to rules are eligible to Bid under the Policyholder Reservation Portion.
