The government has given Life Insurance Corporation of India (LIC) extra time, until May 2032, to ensure that at least 25 percent of its shares are owned by the public.
LIC, the largest insurance company in the country, became publicly listed in May 2022.
The government, which currently owns 96.5 percent of LIC, sold a 3.5 percent stake in the company through an Initial Public Offering (IPO), offering more than 22.13 crore shares.
According to the stock exchange information provided by LIC, the Department of Economic Affairs has granted a one-time exemption to LIC to meet the 25 percent minimum public shareholding requirement within 10 years from the date of listing, which is by May 2032.
The general rule is that every publicly listed company should have a minimum of 25 percent public shareholding.
Newly listed companies are required to achieve this within 3 years, while for listed companies with a market capitalization exceeding Rs 1 lakh crore, the time frame is 5 years.
Earlier this year, the government modified the rules so that even after privatization, publicly listed sector companies and banks could be exempted from the 25 percent minimum public shareholding requirement in the interest of the public, as needed.
Before this amendment, only government-controlled companies were exempted from this rule.
The amendment, introduced in January, is expected to make the acquisition of these companies more attractive to investors after the government sells its stake in public sector listed companies and banks.
In July 2021, the government had previously announced that all publicly listed sector units would be exempted from the minimum public shareholding requirement.
