IT’S A BIG QUESTION IN OUR MIND LIC’S IPO IS GOOD OR BAD ???

Let’s understand in Details….

Q1.  What is  INITIAL PUBLIC OFFERING (IPO)????

• An IPO is a big step for a company.
• It provides the company with access to raising a lot of money.
• This gives the company a greater ability to grow and expand.
• Its increased transparency and share listing credibility.

Initial Public Offering (IPO) of LIC has developed into a Big Problem because of some TV Channels who have NOT understood it and say that “LIC is going to be Privatized” !!

 CLEARLY giving you Explanation

This Process of listing Government Companies as well as Banks started in the year 1994 itself.

In fact, SBI which is the Treasury Bank of India is also listed in Stock Exchange.

Government holds just 58% of SBI Shares.

In the same way,

Hindustan Petroleum

IDBI Bank

Many other Nationalized Bank are listed in Stock Exchange.

This doesn’t mean Privatization.

They are very much within the control of “Government of India” only.

Our Finance Minister has hinted to offload a Very Small Percentage of Government Holding to Private.  This has nothing to do with Privatization.

It is ONLY sharing a small percentage of Government’s Profit.

I’m posting the Interview of our Finance Minister in “The Hindu” Paper below this message where it is mentioned that “LIC Policy will retain its Sovereign Guarantee” which means that Government of India will continue to give CASH GUARANTEE to all LIC POLICIES as per Sec 37 of LIC Act, 1956!

The 60-year-old state-owned firm, LIC, is the country’s largest insurer, controlling more than 70 percent of the market share.

 The insurer has a market share of 76.28 percent in the number of policies,

and 71 percent in first-year premiums.

 LIC has many subsidiaries including IDBI Bank.

It acquired controlling stake in IDBI Bank last year.

Listing of Life Insurance Corporation may be done in the second half of the next financial year, Finance Secretary Rajiv Kumar said.

Finance Minister Nirmala Sitharaman while presenting the Budget 2020-21 on Saturday announced a stake sale in LIC through an initial public offer in the next fiscal.

Listing of LIC will bring in greater transparency, public participation and also deepen the equity market,

Being a policyholder, We welcome the government’s move to get Life Insurance Corporation (LIC) listed in the stock exchange as this would make the company more answerable to the investors