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The Department of Investment and Public Asset Management (DIPAM) had in January appointed actuarial agency Milliman Advisors LLP India to assess the embedded worth of LIC forward of the IPO (Initial Public Offering), which is touted to be the most important public difficulty in Indian company historical past.
- PTI New Delhi
- Last Updated:July 12, 2021, 22:36 IST
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The Union Cabinet has cleared disinvestment of the nation’s largest insurer LIC and a panel headed by the finance minister will now determine on the quantum of stake dilution, a senior official mentioned on Monday. The Department of Investment and Public Asset Management (DIPAM) had in January appointed actuarial agency Milliman Advisors LLP India to assess the embedded worth of LIC forward of the IPO (Initial Public Offering), which is touted to be the most important public difficulty in Indian company historical past.
The Budget amendments to the LIC Act has been notified and the actuarial agency is predicted to finalise the embedded worth of the life insurer. Under the embedded worth technique, the insurance coverage firm’s current worth of future revenue can be included in its current web asset worth. “The Cabinet Committee for Economic Affairs last week cleared the proposal of initial public offering of LIC. The alternative mechanism on disinvestment will now decide on the quantum of stake to be divested by government,” the official mentioned.
The authorities expects to come out with the LIC IPO by the tip of present fiscal, the official added. Up to 10 per cent of the LIC IPO difficulty measurement could be reserved for policyholders.
The authorities has already introduced in required legislative amendments within the LIC Act for the proposed IPO. Deloitte and SBI Caps have been appointed as pre-IPO transaction advisors.
The itemizing of LIC will likely be essential for the federal government to meet its disinvestment goal. The authorities goals to mop up Rs 1.75 lakh crore within the present fiscal from minority stake sale and privatisation. Of the Rs 1.75 lakh crore, Rs 1 lakh crore is to come from promoting authorities’s stakes in public sector banks and monetary establishments. The remaining Rs 75,000 crore would come as CPSE disinvestment receipts.
In her Budget speech in February this 12 months, Finance Minister Nirmala Sitharaman mentioned the IPO of LIC could be floated in 2021-22.
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