26 Jun 2022

"LIC 2.0" Flop Delets Over $ 18 Billion IPO Wealth; Forward Pain?

India's first major public offering (IPO) for Life Insurance Corporation (LIC), considered the next phase of the country's insurance, "LIC 2.0", has declined from the sad listing of discounted benchmarks, and losses. it costs about a third of the price.
LIC stocks plummeted on Friday to R661.70, down 3.2 percent a day, and fell 30 percent to R949 per share, making it one of the top economists among IPOs this year after a crisis. about $ 18 billion of market value off.

Indeed, to put the magnitude of the loss in context, as it has dropped to about a third of its value since its inception on May 17, the LIC IPO is now at a high level of capital losses since its release, starting with a discounted list and ongoing trading pressure.

That despite the mandatory time to close the investment portfolio in the first 30 days.

While that regulatory rule was to stop investors from withdrawing shares immediately after being listed, it does not stop the bleeding from LIC shares.

The mandatory closing period of 50 percent of investment from participating investors, or a qualified institutional buyer (QIB), expires on June 10. However, the remaining 50 percent of their investment will be closed within 90 days from the date of listing.

The government said it was "concerned" about the temporary downturn in the LIC fund and that insurers would look into these factors and increase the number of shareholders.

"We are deeply concerned about the temporary decline in the value of LIC. People will take the time to understand (the basics) of LIC. LIC management will look at all these factors and increase the number of shareholders," said DIPAM secretary Tuhin Kanta Pandey. earlier this month.

But what did not help the country's insurance giant were the disappointing financial results and the lack of communication between the company's management and its growth plans.

Since its first appearance in the stock market, the script has hit okusha 650 new declines and ₹ 920 highs a few days after its listing, which is below its engo 949 offer price.

The country's biggest insurance policy and capital market capitalization (m-cap) fell to ₹ 4.2 lakh crore on Friday, clearing more than ₹ 1.8 lakh crore.

With a release value of ₹ 949, the company m-cap stands slightly above ₹ 6 lakh crore.

Rising interest rates and global inflation have hurt the external demand for Indian stocks.

With unpredictable global stock markets expected and the Indian stock market facing unprecedented trading pressure, more pain awaits LIC shares.

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