India to raise up to $3.3 billion by selling stake in country’s largest life insurer at 10% discount
Indian government plans to raise up to $3.3 billion by selling its stake in the country's top life insurance company.
The Indian government will sell up to a 6.5% stake in state-owned Life Insurance Corporation of India at a 10% discount to its Monday closing price, as it moves to comply with regulatory requirements.
The stake sale will fetch the government up to 314 billion rupees ($3.3 billion) through the offer, which consists of a base size of a 2.5% stake and an option to sell an additional 4% in the country's largest insurance company, LIC said in a stock exchange filing on Monday.
The offer for sale, priced at 382 rupees per share, will open on Tuesday and end on Wednesday.
The government of India owns a 96.5% stake in LIC, which it needs to reduce to 75% by 2032 to meet the minimum public shareholding requirements.
LIC is the leading life insurance company in India with over 56% market share based on premium income. As of the end of March 2026, the firm had assets under management of 57.29 trillion rupees (about $600 billion).
The government had sold a 3.5% stake in the insurer during its IPO in 2022, which was among the largest share issues in the Indian markets at that time, raising over $2.7 billion.
On a year-to-date basis, while India's benchmark Nifty 50 is trading 5.25% lower, shares of LIC are down about 0.5%. Shares of LIC were trading down nearly 9% Tuesday.
Earlier this year, the government sold stakes in several companies such as Cochin Shipyard, Indian Railways Finance Corp, NHPC, and Coal India, raising a total of 210 billion rupees ($2.2 billion), as per data from India's Ministry of Finance.
Citi expects the government to ramp up its disinvestment receipts to more than $8 billion in fiscal year ending March 2027, the highest in 7 years, as the state prices shares at large discounts to ensure that large-sized stock sales find buyers, with enough value being left on the table.
