LIC OFS opens for retail investors today - Here's how you can subscribe to it

The Offer For Sale (OFS) for Life Insurance Corporation of India Ltd. (LIC) will open for retail investors on Wednesday, August 5.

The portion that was open for non-retail investors on Tuesday received a healthy response and was oversubscribed by 3.32 times the base issue size.

In response to this, the government has decided to exercise the entire greenshoe option for the OFS, Secretary of the Department of Disinvestment and Public Asset Management (DIPAM) wrote on his social media handle on "X".

The government intends to sell up to 6.5% stake in Life Insurance Corporation of India, India's largest insurance company, through this OFS process. The base issue size was 2.5% of the total equity with a greenshoe option to sell another 4%.

In case the entire 6.5% equity is sold in the OFS, the government would be able to mop up close to ₹31,000 crore, taking their total disinvestment proceeds through the OFS route past ₹50,000 crore for the current financial year. Floor price for the OFS had been fixed at ₹382 per share.

Here's how retail investors can subscribe to the OFS:

Log in to your broker's portal or mobile trading application.
Go to the IPO / OFS or corporate actions section, whichever available.
Select the Active OFS tab and find the name of the company (LIC in this case).
Enter the number of shares you want to bid for and enter the price or the cut-off option.
Submit the order. Please ensure that your demat account has the requisite balance before placing your order, else your bid will be rejected.
Bids will also be rejected if the price entered is below the cut-off price. For LIC's non-retail bidders, the clearing price has been fixed at ₹383.1.

CNBC-TV18 reported exclusively on Tuesday that the government has assured stakeholders that there will be no further divestment of the government's stake in LIC after this process, for the next two to three years.

In case the OFS receives full subscription, the government stake in LIC would fall to 90%.

At the end of the June quarter, LIC had a total of 21 lakh small retail investors, or those with authorized share capital of up to ₹2 lakh. These investors own a 1.5% stake in the company.

Shares of LIC ended 8.7% lower on Tuesday at ₹391.3. The stock was the top loser on the Nifty 500 index.