Everything you need to know about the LIC IPO
Everything you need to know about the LIC IPO
Hello Friends and welcome to another insightful and exciting IPO Special podcast by Angel Broking.
Doston iss podcast mein hum LIC IPO ke baare mein baat karengein.
Friends LIC toh ek bahut purani company hai aur kaafi well-known bhi hai. Many investors might already have LIC policies or would have had one at some point of time. Phir yeh baat bhi hai ki LIC is in the business of insurance; bahut investors ka soch eh hai ki insurance ke liye demand toh hamesha rahegi, toh yeh acha investment option ho sakta hai.
A smart investor, however, will want to dig deeper and find out as much as possible about LIC. Aakhir, market mein kaafi saari insurance companies hai. Ek zamaane mein LIC ka market monopoly tha, lekin aaj LIC ke liye bhi tough competition hai.
Aap LIC ke baare mein shayad research karna chahte ho, aur iss liye yeh podcast sun rahe ho - this is an excellent first step. Chaliye let's discover all the important details around LIC and its much-anticipated IPO.
Hum yeh details ek structured tareeke se discuss karengein, taki aapko maximum advantage mile. Three-part discussion rahega:
We will start with talking about the IPO itself- kab hone wala hai; how it is different, size of the IPO etc.
Phir dekhenge LIC's performance during the pandemic and prior.
Then we will look at LIC versus its peers, including prior IPOs.
Part 1 - All about the IPO itself: Yeh IPO itna khaas kyun hai?
Pehli baat yeh hai ki LIC IPO India ka sabse bada IPO reh sakta hai when it happens. Scheduled date abhi tak release nahi huyi hai, lekin it is anticipated that it will occur in the third quarter, which means sometime between October and December this year. 2021 ke andar hi yeh exciting IPO hone ke chances hain, according to reports.
Dusri baat yeh hain ki ab tak company ne apna Red Herring Prospectus file nahi kiya hai.
Okay so a little background about LIC’s structure. Bharat sarkar ka LIC mein kaafi investment hai. The government wants to sell its stake in LIC in order to raise capital that it requires. Sarkar ka yeh goal hai ki Rs 90,000 crore raise ho jaaye out of selling 6% to 7% of its stake in LIC. Government ka disinvestment target bahut uncha hai - government Rs 2.51 lakh crore disinvestment karna chahte hai jis mein se they are hoping ki, almost 45% will come from the LIC IPO.
Teesri baat hai policyholders ki: excitement has been generated among policyholders kyunki government ne bataya hai ki 10% of the IPO issue will be reserved for policyholders. It is expected ki 1 crore se zyaada demat accounts khulengein before the LIC IPO.
Toh IPO ka size, popularity of the LIC name, buzz generated by its large volume of policyholders, aur government involvement ke karan, there is so much buzz and headlines around the LIC IPO.
Part 2 - LIC's performance, financial status and valuation
Headlines dekh ke any IPO can seem attractive, lekin invest karne ki tayaari mein, first step hai - observe the company's business and financials.
Mai highlights bata raha hu, lekin mere kehne pe mat jao; do observe the company's financials carefully.
Chaliye highlights dekhte hai:
LIC is India's largest financial institution. Inke assets ka value hai Rs 32 lakh crore.
During the worst of the pandemic, yaani ke April 2020 se September 2020 tak ke period mein LIC ka capital market investment raha Rs 260,000 crore with returns of Rs 15,000 crore. Pichle saal ke yahi period mein investment amount tha Rs 244,000 ke aas paas. LIC ne market dip ke samay fayda liya.
Various figures have been released with regards to LIC's valuation. The government valuation stands at about Rs 12 to 15 lakh crore aur kahi private companies ne valuation kiya hai at about Rs 9 to 10 lakh crore.
LIC has about Rs 28 crore to Rs 35 crore worth of policies in force
Premium collection ka total tha Rs 45 crore to Rs 50 crore
Part 3 - LIC versus its peers
LIC ke financials ki yeh highlights dekh ke, everything looks bright and sunny. Thoda zoom out bhi karte hai and let's look at the larger picture.
Here are some figures to consider.
This first set of figures looks at LIC's market share during the absolute peak of the pandemic, from April to September 2020.
LIC's market share with regards to sheer number of policies stood at 67% - jo, in comparison, 2019-2020 fiscal mein 69% raha according to LIC's annual report
LIC's market share with regards to first year premiums stood at 70%.
Capital market investment Rs 260,000 crore with returns of Rs 15,000 crore.
As of March 2021, LIC definitely had a bigger network than its peer group:
With a huuuge 13.5 lakh agents out on the field as compared to 11 lakh agents between 20 other insurers. Matlab 20 insurance companies mil ke bhi LIC ka sales network match nahi kar paya.
Aur yeh toh pandemic waale numbers hai. Pandemic ke pehle LIC was doing even better. Yeh figures March 2020 ke hai:
Uss samey, LIC ka sales network bhi double tha - tabhi toh 22 lakh agents the.
Abhi dekhte hai, the performance of other insurance companies that have gone public. Ab things get a little more real, dost:
2 general insurance companies have gone public recently namely New India Assurance and General Insurance Company of India.
General Insurance Company of India IPO mein, shares ka offer price tha Rs 912 aur yeh same shares ka abhi stock market mein Rs 200 ke around market price hain- at the time of writing.
New India Assurance IPO mein shares ka offer price tha Rs 770 to Rs 800, jo abhi Rs 168 ke around chal raha hain at the time of writing this podcast.
IPO mein invest karne se pehle, always consider your risk appetite and research the company in detail.
Lastly, yeh baat yaad rakhiyega ke stock market investing main risk hamesha rahega. This podcast has been made for educational purposes only and the investor must do his own research as well. There’s no shortcut here.
Aise aur interesting IPO special podcasts sunne ke liye humein follow karein via our youtube and other social media channels. Until then goodbye and happy investing!
Investments in the securities markets are subject to market risks. Read all the related documents carefully before investing.