New Delhi, August 4: Shares of Life Insurance Corporation of India (LIC) fell sharply on Tuesday after the Union Government announced plans to reduce its stake in the insurance giant through an Offer for Sale (OFS).
LIC shares came under heavy selling pressure in early trade, declining by nearly 8 per cent after the government’s announcement.
The stock touched an intraday low of ₹390.70 as investors reacted to the proposed stake sale.
The Centre plans to divest up to 6.5 per cent of its holding in LIC through the OFS.
The offer includes:
- Initial offer: 2.5 per cent stake
- Greenshoe option: Up to an additional 4 per cent stake
If fully subscribed, the stake sale is expected to raise around ₹31,000 crore for the government.
The floor price for the OFS has been fixed at ₹382 per share, approximately 11 per cent below Monday’s closing price.
The OFS opened for institutional investors on Tuesday, while retail investors will be able to participate from Wednesday.
The Union Government currently holds 96.5 per cent of LIC, with the remaining 3.5 per cent owned by public shareholders.
Following the completion of the OFS, the government’s holding is expected to decline to around 90 per cent.
The stake dilution is aimed at complying with the Securities and Exchange Board of India (SEBI) requirement mandating listed companies to meet minimum public shareholding norms by May 2027.
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