LIC Shares Crash 9% in Just Two Days as Rs. 31,000-Crore OFS Opens for Retail Investors Today

LIC stock has fallen sharply ever since the offer was announced. Over the last two days the share has dropped more than 9%. LIC shares wrapped the July month on flat note at Rs. 424.45 per share. Ever since the opening on Monday, the share price has been falling.

Currently, LIC's movement has been largely flat today at Rs. 391.40, up by 0.051%, recovering slightly after Tuesday's sharp 7.86% fall, as retail bidding in the government's OFS begins today.

The stock opened at Rs. 386.00 and touched an intraday high of Rs. 397.35 and a low of Rs. 385.90.

LIC's market capitalisation currently stands at Rs. 4.96 lakh crore, with the stock trading at a P/E ratio of 8.63.

Trading volume at the counter has been heavy today, with combined NSE and BSE volumes touching 30.2 million shares as of 12:02 pm.

LIC OFS Details

The Government of India's Offer for Sale (OFS) in Life Insurance Corporation of India (LIC) opened for retail investors and eligible employees today. This is the second and final day of bidding. The floor price has been fixed at Rs. 382 per share, around a 10% discount to LIC's August 3 closing price of Rs. 424.35.

Retail investors and employees get an additional Rs. 10/ share discount, which brings their price to Rs. 373.10. The bidding window runs from 9:15 am to 3:30 pm, with 10% of the total offer, which is 8.22 crore equity shares, reserved for retail investors placing bids of up to Rs. 2 lakh.

The government has increased the OFS from a base 2.5% stake to up to 6.5% by exercising its green-shoe option, after Day 1 non-retail bidding on Tuesday was subscribed 3.32 times, with institutional investors placing bids worth Rs. 36,400 crore.

If the full offer goes through, the government could raise close to Rs. 31,000 crore, reducing its stake in LIC from 96.5% to 90%, moving the insurer closer to SEBI's mandated 10% minimum public shareholding norm by May 2027.

This is LIC's first stake sale since its 2022 listing, when the government sold a 3.5% stake via IPO at Rs. 949 a share to raise about Rs. 21,000 crore.