Life Insurance Corporation of India (LIC) shares dropped over 1% to ₹935.50 on Thursday, July 10, following news that the government has approved an Offer for Sale (OFS) in the company. The move is part of the Centre’s broader strategy to meet disinvestment targets and boost public shareholding in LIC.
LIC share price opened at ₹941 in the morning session, slightly lower than Wednesday’s closing price of ₹946. While the stock has gained over 12% in the last six months, it is still down nearly 11% over the past year. At 12:29 PM, the stock was down 1.31% and was trading at ₹933.60.
According to a report by CNBC-TV18, the government has given the go-ahead for an OFS in LIC. Currently, the Centre holds a 96.5% stake in the insurance giant, while the remaining 3.5% is held by public investors.
With LIC’s market value nearing ₹6 lakh crore, selling just 1% of the stake could bring in around ₹6,000 crore for the government. This move is seen as a key step in the government's ongoing disinvestment drive.
As per news reports, the centre may divest a total of 6.5% in LIC over the next two years. This will be done in multiple phases to gradually meet SEBI’s rules. In May last year, SEBI had allowed LIC time until 2027 to raise its public shareholding to at least 10%.
An OFS typically means more shares are available in the market, which can temporarily bring down the stock price. However, it also opens up more opportunities for retail and institutional investors to invest in the company.
Read more: LIC Nav Jeevan Shree Plan: Single Premium Life Insurance with Multi-Year Benefits.
The government's approval for LIC's OFS is a significant move in its disinvestment plan. While the stock saw a short-term dip, the step could help increase transparency, improve liquidity, and bring LIC closer to meeting regulatory requirements. Investors will be watching closely for further updates.
Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions.
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Published on: Jul 10, 2025, 12:32 PM IST
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