India¡¯s largest-ever IPO, i.e. the LIC IPO, has been in the news for a much-anticipated rollout since the Finance Minister announced it in Budget 2021.?
And over the past few months, it was widely expected that the LIC IPO would be rolled out within the ongoing financial year 2021-22, i.e latest by March 31, 2022. Moreover, even the market regulator SEBI had given the green signal for the IPO and cleared the draft prospectus.
But with just about two weeks to go for this financial year to end, it seems that prospective investors might have to wait longer for India¡¯s largest IPO.
It's being anticipated that the LIC IPO may be pushed further amidst the international turbulence due to Ukraine-Russia war and the stock market volatility.
Also Read:?Jefferies India Says LIC IPO Can Disrupt Market Balance
As per a report today in TOI, the government is waiting for the stock market, which has become volatile in the wake of the Russian invasion of Ukraine in the past two-three weeks, to stabilise before going ahead with the mega IPO of LIC, according to what official sources have said. All this has triggered prospects of the issue being deferred for now.
Since Russia's invasion and declaration of war on Ukraine in February last week, uncertainty has gripped the country's biggest IPO, with plans to list it before the end of the financial year on March 31, 2022, seeming to be in jeopardy.?
Sources also said that the government has time until May 12 to unveil the IPO on the basis of the documents filed with the stock market regulator SEBI.
The government had already filed the draft prospectus with SBI on February 13th 2022, and sources said all eyes are now on the state of the stock market and any listing would depend on when the volatility reduces, according to a?TOI report.
The sources further stated that authorities are watching the volatility index, which had spiked sharply after Russia's invasion of Ukraine, and is currently ruling at around 25.3 and the view within the government is that it should settle at around 15 levels to take a call on the timing of the LIC IPO.
So, overall, it seems that the LIC IPO may be deferred for the next financial year, and likely to be rolled out by May 12th, 2022, as the govt has time till this date to roll out the IPO on the basis of documents filed and cleared by SEBI.
If the govt fails to file the IPO in FY2021-22, i.e. by March 31, 2022, it is expected to miss its disinvestment target of Rs 1.75 lakh crore for this FY, out of which LIC IPO has been likely to fetch them around ?80,000 crore to ?1 lakh crore through the share sale.
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