Much-awaited IPO of Life Insurance Corporation of India (LIC) may get delayed given the deteriorating geopolitical situation and the consequent volatile state of financial markets.
Finance Minister of India Nirmala Sitharaman said that they might review the timing of the launch of the IPO. Usually, IPOs are launched when the market is in a bullish run.
India’s largest IPO, which makes up the most significant portion of the country’s $10.4 billion asset-sale programs, aims to stanch the budget deficit for the year through 31st March 2022.
The Government filled Its IPO document on 13th February, putting the insurance giant’s embedded value at 5.4 trillion Rupees.
Experts also pointed out that the Government’s idea to rethink the timeline is fair, explaining that sticking to the March-end target could require the shares to be priced lower than the currently expected Rs 2,000-2,100.
Lower pricing of the LIC IPO would not help the Government reach its divestment target. Only in a good market would it be possible to attract a market capitalisation of Rs 13-14 lakh crore.
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