After the LIC IPO lists on Tuesday, what should LIC policyholders do? Should they buy, sell, or hold
On Tuesday, May 17, the Life Insurance Corporation of India (LIC) is prepared to begin its stock market trip. During its subscription period, investors responded enthusiastically to India's largest public offering. Over the 16.20 crore shares that were offered, the LIC IPO received 2.95 times as much interest. Additionally, the section designated for LIC policyholders was booked 6.12 times. But at a time when the stock market is incredibly unpredictable and the central bank is raising interest rates to rein in soaring inflation, the LIC IPO is going public.
Consequently, if you have gotten your LIC share, the following listing day method should be used.
What LIC IPO GMP Suggests
Monday saw an improvement in the LIC IPO's grey market premium. According to IPO Watch, LIC shares were trading on the black market at a discount of Rs 12 per share. Over the weekend, LIC unlisted shares were trading at a discount of Rs. 15–20 per share. The negative grey market premium suggests that the May 17 listing of LIC stock will most likely be at a modest to reduced price.
LIC Policyholders: What Analysts Say about LIC Listing
Analysts and market watchers anticipate a subdued listing for LIC. The ongoing sell-offs in the local and international equity markets concerns over geopolitics following Russia's invasion of Ukraine, and rising inflation rates have subdued the excitement around the listing of the big LIC IPO. "We anticipate a LIC listing between a 7% discount to a 3% premium, "said Vice Chairman of GCL Securities Ravi Singhal.
Investors ought to go into the listing day with reasonable expectations on both sides, "said Narendra Solanki, head of fundamental analysis for Anand Rathi's investment services.
For the LIC IPO, the price range was set at Rs. 902–949 per share. 10% of the issuance amount was set aside by the government for LIC policyholders. Employees and retail investors qualified for a discount of Rs 45, whereas they were entitled to a discount of Rs 60. Due to an inherent discount built into the IPO, even a flat listing might be profitable for policyholders and retail investors, according to Solanki.
"LIC's offer was never viewed as a candidate for listing gain; only the long term should be evaluated. We encourage allotted investors not to panic and to hold it for the medium to long term given the market emotions, which are still frightening and volatile in light of recent global headlines, according to Prashanth Tape, VP (Research), Mehta Equities Ltd.
According to Solanki, LIC policyholders should hold onto their shares for as long as they can because the company is now enjoying very favorable prices.