Having set an ambitions disinvestment target for itself, the Narendra Modi government is considering selling up to 25 per cent stake in the Life Insurance Corporation (LIC), Bloomberg has reported.
According to this report, the government may amend the act of parliament under which the LIC was set up as it prepares for the stake sale.
“The sale is likely to be done in tranches while the timing of the IPO will depend on market conditions,” the Bloomberg report says.
When the government had revealed the plan to sell stake in LIC earlier this year, finance secretary Rajiv Kumar had said that an interministerial committee will be set up to oversee the stake sale. It would have officials from the department of investment and public asset management, department of financial services and law ministry, the finance secretery had said in February this year.
“It will take at least a year,” he had been quoted as saying back then.
In her budget speech this year, Finance Minister Nirmala Sitharaman had said that the LIC initial public offering will unlock its value.
“Listing of companies on stock exchanges discipline a company and provides access to financial markets and unlocks its value. It also gives opportunity for retail investors to participate in the wealth so created," she had said.
The government has pegged the disinvestment target for 2020-21 at Rs 1.20 lakh crore, nearly double of Rs 65,000 crore in the fiscal year 2019-20.
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