Business strategy

LIC IPO GMP Improves Today But Still Negative; Listing Likely On May 17; Check Key Details

The LIC IPO, the country’s biggest public offer that was open for subscription between May 4 and May 9, witnessed a positive response from the market and was oversubscribed, with 2.95 times subscription. However, the company’s grey market premium (GMP) is indicating a lacklustre listing, which is likely to take place on May 17. The share allotment is already complete on May 12.

The Latest LIC IPO GMP

The company’s unlisted shares currently are trading at Rs 936 apiece on Sunday, which is Rs 13 lower than the upper limit of the IPO price band, according to the latest GMP price available on chanakyanipothi.com. This is the fifth consecutive day when the LIC IPO GMP is in negative territory. The price band for the LIC IPO was fixed at Rs 902-Rs 949 per equity share.

The current grey market premium (GMP) of minus Rs 13 is, however, better than the minus Rs 20 recorded on Saturday. The GMP was minus Rs 25 on Friday. The trend shows improving sentiments on the company’s shares.

An IPO grey market is one where a company’s shares are bid and offered by traders unofficially. This takes place before the company’s shares are even listed on the stock exchanges. Grey market premium is the extra amount investors are ready to pay for the company’s shares. However, a negative GMP shows the negative sentiment of investors towards the shares.

About LIC IPO

LIC’s initial public offering (IPO) received 2.95 times subscription on the final day of bidding, with the portion reserved for qualified institutional buyers (QIBs) fully booked. The bids received were 47.83 crore against the offer size of 16.21 crore. The LIC IPO’s price band was fixed at Rs 902-949 per share and the company offered a discount of Rs 60 per share for its policyholders and Rs 45 apiece for retail investors and LIC employees.

Eligible investors are expected to see the shares credited on May 16 and the company is likely to see the listing on stock exchanges on May 17. LIC finalised the share allotment on Thursday.

LIC IPO created a record with the number of applications for the stock of the country’s insurance behemoth crossing 5.9 million on May 8. The portion reserved for retail investors was fully subscribed on the third day and 1.59 times by the end of the fifth day of subscription. The issue has finally received 13.8 crore bids from retail individual investors, against 6.9 crore shares set aside for them.

The much-awaited IPO was a tremendous success and the issue was subscribed nearly 3 times at the close, DIPAM Secretary Tuhin Kanta Pandey has said. “We are pleased to inform you that the IPO offer which started on the 4th of May has closed today at 7 pm and it has met with tremendous success from all categories of investors; this will eventually lead to the listing of LIC and deepen the capital market.”

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