The Indian government, acting through the Department of Financial Services under the Ministry of Finance, has announced a significant Offer For Sale (OFS) in Life Insurance Corporation of India (LIC). The government plans to sell up to a 6.5% stake in the state-run insurer, with the OFS commencing on Tuesday, August 4, 2026.
OFS Details and Pricing
The floor price for the OFS has been fixed at Rs 382 per equity share, which represents a discount of approximately 10% compared to LIC's closing price of Rs 424.35 on BSE on the preceding Monday. Retail investors and LIC employees will be offered an additional discount of Rs 10 per share on the cut-off price on T Day (August 4, 2026).
The initial base issue comprises 31,62,49,885 LIC shares, equivalent to 2.50% of the total paid-up equity capital. Should there be oversubscription, the promoter intends to sell an additional 50,59,99,816 equity shares, accounting for a further 4% stake. This brings the total potential divestment to 82,22,49,701 shares, or 6.5%.
Investor Categories and Bidding Schedule
- Non-Retail Investors: Can place bids on T Day, August 4, 2026. They have the option to carry forward un-allotted bids to T+1 day for allocation in the unsubscribed portion of the retail category.
- Retail Investors and Employees: Bidding is scheduled for T+1 Day, August 5, 2026. This also applies to non-retail investors who choose to carry forward their bids.
The bidding window will operate during trading hours on a separate stock exchange window, from 9:15 a.m. to 3:30 p.m. Indian Standard Time on the respective dates.
Reservations and Allocations
- A minimum of 25% of the offer shares are reserved for mutual funds and insurance companies.
- At least 10% of the offer shares are specifically reserved for retail investors, defined as individuals bidding for shares with a total value not exceeding Rs 2,00,000.
- An additional 50,00,000 shares, representing 0.04% of the total issued and paid-up equity, will be offered to eligible LIC employees through the stock exchange mechanism.
Retail investors are permitted to bid at any price above the floor price or at the "Cut-Off Price." The Cut-Off Price is defined as the lowest price at which the entire offer shares are sold, based on all valid bids received in both retail and non-retail categories.
Brokerage and Settlement
IIFL Capital Services, Goldman Sachs (India) Securities, BNP Paribas Securities India, and Motilal Oswal Investment Advisors have been appointed as brokers on behalf of the sellers. IIFL Capital Services will also serve as the settlement broker for the OFS.