The state-owned life insurance of the Indian Corp., with a typical blue and yellow logo, everywhere throughout the country of 1.4 billion people. LIC controlled nearly two-thirds of the Indian market, with almost 300 million policies and more than 1.3 million agents, 100,000 employees, 2,000 branches and 1,500 satellite offices. Administration of Prime Minister Narendra Modi is a racing to sell at least 5% of LIC in what will be the biggest initial public offering in India and the fourth largest IPO of every insurance company globally. Solely the scale presents a unique challenge for less developed capital markets in the country, and a large test of Modi plans to make the economy more efficient.
1. Why does the government sell shares?
LIC sales are the largest part of the $ 10.4 billion asset sales program intended to include the Indian budget deficit for the year to March. The government plans to drive loans to a record in the next fiscal year because trying to spend a way out of a decrease induced pandemic.
2. When is the IPO?
Minister of Finance Nirmala Sitharaman has set a March deadline for listings. The IPO was originally scheduled for the fiscal year since April 2020, but was postponed when the rules of staying in the Indian harsh house during the pandemic disrupted preparation.
3. Why rate the company is so difficult?
LIC size and special status make a unique challenge. It accommodates $ 530 billion assets, more than the total size of the country’s mutual fund industry. Milliman and Ernst & Young, the companies appointed to work on assessment, have spread through millions of policies to take into account parameters including mortality, morbidity, irregularities in premium payments and policy cancellations. They also have to weigh the property value remains LIC in 2,000 branches. LIC released its neracus only once a year, and a complicated peer-to-peer comparison.
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