Skip to content 
Search

Latest Stories

Why is India's largest insurer being listed?

Why is India's largest insurer being listed?

INDIA is embarking on the listing of the country's largest insurer as part of a wider privatisation drive to bolster public coffers drained by the coronavirus pandemic and fund new infrastructure.

While the pricing has not yet been set, analysts expect the IPO of the Life Insurance Corporation of India (LIC) to be India's largest to date, potentially earning the government more than $10 billion (£7.4 bn).

After the listing, which is expected in March, LIC will be one of India's biggest publicly listed companies alongside giants such as Reliance and TCS.

LIC was created in 1956 and was synonymous with life insurance in post-independence India until private firms were allowed entry in 2000.

The company holds a two-thirds share in the domestic life insurance market. It manages assets of Rs 36.7 trillion (£363.45 bn), which equates to nearly 16 per cent of India's gross domestic product.

It has more than 100,000 employees and one million insurance agents.

LIC's real estate assets include big offices at prime locations in various Indian cities, including a 15-storey building in the southern city of Chennai and a distinctively curved head office in the heart of Mumbai's financial district.

The firm is also believed to own a large collection of rare and valuable artwork that includes paintings by MF Hussain - known as the Pablo Picasso of India - although the value of these holdings has not been made public.

Why is the IPO taking place?

Asia's third-largest economy was already grappling with a prolonged slowdown even before the start of the coronavirus pandemic. India has recorded its worst recession since independence due to the Covid-19 crisis.

Efforts to contain the spread of the virus, such as through stringent lockdowns, created a significant budget deficit and pushed millions into joblessness and poverty.

The IPO of LIC will give a boost to the government's efforts to raise much-needed cash through privatisations, which are running badly behind schedule.

The government has raised just Rs 120.3 bn (£1.18 bn) by selling stakes in various state-owned entities this financial year, well short of its target of Rs 780 bn (£7.63 bn).

Srinath Sridharan, an independent markets commentator, likened LIC to one of the Indian government's "family jewels".

Is it an attractive investment?

LIC is a household name in India and has a strong grip on the life insurance market in the vast south Asian nation despite the entry of private players.

The company is offering its millions of policyholders the opportunity to invest in the IPO at a discount, promoting the offer through television advertisements and full-page newspaper ads.

Analysts expect retail investors, including many first-timers, to show a strong appetite for snaring a stake in the venerable company.

But there are numerous uncertainties for investors. These include question marks over whether investment decisions can be made by LIC management without interference from the government.

It is also unclear if LIC will be able to retain its market share, with increased competition for younger consumers from more tech-savvy new entrants to the market.

(AFP)

More For You

Bangladesh seeks US deal to shield garment industry from tariffs

Workers are engaged at their sewing stations in a garment factory in Savar, on the outskirts of Dhaka, on April 9, 2025. (Photo by MUNIR UZ ZAMAN/AFP via Getty Images)

Bangladesh seeks US deal to shield garment industry from tariffs

BANGLADESH, the world's second-biggest garment manufacturer, aims to strike a trade deal with the US before Donald Trump's punishing tariffs kick in next week, said the country's top commerce official.

Dhaka is proposing to buy Boeing planes and boost imports of US wheat, cotton and oil in a bid to reduce the trade deficit, which Trump used as the reason for imposing painful levies in his "Liberation Day" announcement.

Keep ReadingShow less
UK business district
The Canary Wharf business district including global financial institutions in London.
Getty Images

Bond yields ease following Starmer’s support for Reeves

THE COST of UK government borrowing fell on Thursday, partially reversing the rise seen after Chancellor Rachel Reeves became emotional during Prime Minister’s Questions.

The yield on 10-year government bonds dropped to 4.55 per cent, down from 4.61 per cent the previous day. The pound also recovered slightly to $1.3668 (around £1.00), though it did not regain all its earlier losses.

Keep ReadingShow less
modi-trump-getty
Modi shakes hands with Trump before a meeting at Hyderabad House in New Delhi on February 25, 2020. (Photo: Getty Images)
Getty Images

Indian exporters watch closely as Trump says trade deal with India likely

THE US could reach a trade deal with India that would help American companies compete more easily in the Indian market and reduce tariff rates, President Donald Trump said on Tuesday. However, he cast doubt on a similar deal with Japan.

Speaking to reporters on Air Force One, Trump said he believed India was ready to lower trade barriers, potentially paving the way for an agreement that would avoid the 26 per cent tariff rate he had announced on April 2 and paused until July 9.

Keep ReadingShow less
Kolhapuri sandal sales surge in India post Prada controversy

Customers shop for 'Kolhapuri' sandals, an Indian ethnic footwear, at a store in New Delhi, India, June 27, 2025. REUTERS/Adnan Abidi

Kolhapuri sandal sales surge in India post Prada controversy

INDIAN footwear sellers and artisans are tapping into nationalist pride stoked by the Prada 'sandal scandal' in a bid to boost sales of ethnic slippers with history dating back to the 12th century, raising hopes of reviving a struggling craft.

Sales are surging over the past week for the 'Kolhapuri' sandals that have garnered global attention after Prada sparked a controversy by showcasing similar designs in Milan, without initially crediting the footwear's origins.

Keep ReadingShow less
UK business district
The Canary Wharf business district including global financial institutions in London.
Getty Images

Economy grew 0.7 per cent in Q1 2025, fastest in a year

THE UK economy expanded at its fastest pace in a year during the first quarter of 2025, driven by a rise in home purchases ahead of a tax deadline and higher manufacturing output before the introduction of new US import tariffs.

Gross domestic product rose by 0.7 per cent in the January-to-March period, the Office for National Statistics (ONS) said, confirming its earlier estimate. This was the strongest quarterly growth since the first quarter of 2024.

Keep ReadingShow less