LIC IPO: All eyes are set on the biggest initial public offering (IPO) that as ever been floated in India, as the country’s largest insurance providers is all prepared to launch its public offer in a matter of just one day. While the countdown at Dalal Street is inching towards the end, the LIC IPO for policyholders is exciting too. This is the first time an IPO is having a ‘policyholders’ quota, whereby which such persons can invest in the issue. The LIC IPO will be open between May 4 to May 9, where the company will seek to raise Rs 21,000 crore, making it the biggest public issue in the country till date.
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As excitement over the LIC IPO builds up, here the the key things LIC policyholders should know before investing:
LIC IPO: Discount for Policyholders
The price band for LIC IPO has been set at Rs 902 to Rs 949 per equity share. However, LIC IPO for policyholders is set to see a discount of Rs 60 per share, the company has said in its regulatory filing. Therefore, at the upper end of the price band, LIC policyholders need to pay only Rs 889 per share to invest in the LIC IPO. LIC policyholders can place a maximum bid of Rs 2 lakh for the issue, net of discount to policyholders under the policyholders reservation quota.
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LIC IPO: Policyholders Must Link PAN
LIC policyholders whose PAN is linked to the insurance policy as of February 28, 2022, will be eligible to apply for the LIC IPO, the company has said in its regulatory filing. Therefore, LIC policyholders who do not have their PAN linked to LIC policies will not be eligible to get Rs 60 discount. However, they can still buy discounted shares under the retail investors category, where a Rs 45 per cent discount is being offered.
LIC IPO for Policyholders with Lapsed Policies
All policies that have not exited LIC records due to maturity, surrender, or the policyholder’s death are eligible for reservation under the Policyholder Reservation, LIC has said in its filing. Therefore, policyholders with lapsed policies can also apply for the LIC IPO.
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Which LIC Policyholders Cannot Apply Under Quota?
NRIs cannot apply for the IPO via the Policyholder Reservation Portion as only an Indian citizen can only apply for the LIC IPO. Apart from this, all policies other than group policies qualify for bidding in the Policyholder Reservation Portion.
Can Policyholders Bid for More Than Rs 2 Lakh?
While the LIC has set a maximum bidding limit of Rs 2 lakh for investors, you must note that this is for each category. Therefore, in case LIC IPO for policyholders the maximum limit is Rs 2 lakh. But a policyholder can additionally apply in the retail category with a discount of Rs 45 per share, and increase the maximum bidding limit to Rs 4 lakh.
