India Business Journal - Govt to sell 6.5% in LIC to mop up funds, comply with minimum public holding norm

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Govt to sell 6.5% in LIC to mop up funds, comply with minimum public holding norm

IBJ Bureau
Aug 04, 2026

The government has announced an Offer for Sale (OFS) in Life Insurance Corporation of India (LIC) to divest its 2.5 per cent stake with an option to sell an additional 4 per cent under the greenshoe option.

The issue will open for non-retail investors on Tuesday, while retail investors can bid for it on Wednesday.

The floor price for the OFS has been fixed at Rs 382 per share, the Department of Investment and Public Asset Management (DIPAM) has said in a post on the X.

“(The) Offer for Sale in LIC opens tomorrow for non-retail investors. Retail investors can bid on Wednesday. The government offers to disinvest 2.5 per cent equity with an additional 4 per cent as a greenshoe option. (The) floor price has been fixed as (sic) Rs 382 per share. This will help achieve (the) MPS (minimum public shareholding) milestones ahead of schedule,” DIPAM Secretary Arunish Chawla has said in the post.

If the greenshoe option is fully exercised, the government could sell up to 6.5 per cent of LIC’s equity through the OFS.

The Centre currently holds about 96.5 per cent in LIC. The insurer was listed on the stock exchanges in May 2022 through the country’s biggest initial public offer (IPO).

The latest OFS is expected to increase LIC’s public shareholding and help it move closer to meeting the MPS requirement.

Under the Securities and Exchange Board of India (SEBI) regulations, listed companies are required to maintain a minimum public shareholding of 25 per cent.