Life Insurance Corporation of India's chairperson Mangalam Ramasubramanian Kumar stands for a photograph with a bronze statue of a bull during the LIC listing ceremony at Bombay stock exchange in Mumbai, India, Tuesday, May 17, 2022.
Photo : AP
New Delhi: The government on Friday said it was concerned about the “temporary blip” in LIC shares, as the post-IPO valuation of the company saw Rs 1.4 lakh worth of investor wealth being eroded since listing. Department of Investment and Public Asset Management Secretary Tuhin Kanta Pandey said the LIC management will look into the issue and try to raise shareholders’ value.
"We are very concerned about the temporary blip in LIC share price. People will take time to understand (the fundamentals of) LIC. LIC management will look into all these aspects and will raise the shareholders' value," said DIPAM secretary Pandey, according to PTI.
LIC stock is down over 25% from the issue price of Rs 949; shareholders have lost one-fourth of their investment in the company so far. LIC’s market capitalisation which stood at Rs 6 lakh crore at listing has been reduced to Rs 4.59 lakh crore. This is a loss of Rs 1.4 lakh worth of shareholder wealth.
The loss is equivalent to the entire market capitalisation of some auto companies such as Tata Motors, Tata Steel, Mahindra & Mahindra. LIC now stands at the seventh position on BSE’s top 10 companies by market capitalisation. It is preceded by Reliance Industries with a market cap of Rs 18.67 lakh crore, TCS at Rs 12.48 lakh crore, HDFC BankRs 7.61 lakh crore, Infosys Rs 6.32 lakh crore, HUL at Rs 5.17 lakh crore and ICICI Bank at Rs 5.06 lakh crore.
On May 17, LIC debuted at bourses with a nearly 8% cut, listing at Rs 867.20. This resulted in a sharp fall of LIC m-cap at Rs 5.57 lakh crore, a loss of Rs 42,500 crore on listing itself.
The government garnered Rs 20,500 crore from the public offer of LIC, selling 3.5% stake in the company.
