LIC IPO - Reservation and Special Discount for Policyholders

Neethi V. Kannanth | Last updated: 30 April 2022

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Quick Summary

The LIC IPO, India's largest, opens from May 4th to May 9th, aiming to raise Rs 21,000 crore. Policyholders can benefit from a special reservation quota, offering a discount of Rs 60 per equity share. To be eligible, your PAN must be linked to your LIC policy as of February 28, 2022, and you'll need a demat account matching your policy details.

India's largest IPO,"LIC" is all set to open next week i.e. from May 4 and will close on May 9. It is planning to raise Rs. 21,000 crore through the IPO. And also, there is a special discount on the offer price exclusively for the policyholders! Read on to know more about it.

LIC has reserved 10 percent of equity shares for LIC policyholders. As per the Red Herring Prospectus issued by the LIC, LIC policyholders whose PAN is linked to the insurance policy as of February 28, 2022, will be eligible to apply for the LIC IPO. LIC policyholders can place a maximum bid of Rs 2 lakh for the issue, net of a discount to policyholders under the policyholders reservation quota. Whereas, a minimum of 15 shares is required to be subscribed.

LIC IPO: Policyholder Discount and How to Apply

Policyholders who are eligible will be able to apply at the discounted rate under the "Policyholder Reservation Portion", which is the first of its kind. As per this reservation quota, LIC policyholders will get a discount of Rs 60 on the price band while investing in the IPO. For the general investors,the price band of the LIC IPO is set at Rs 902-Rs 949 per equity share.

The second thing policyholders have to ensure to bid for the LIC IPO is that they have a demat account that matches with the PAN linked to the LIC policy. You can open a demat account by registering with a depository participant (DP), a list of which you can find on NSDL and CDSL websites. You will need an address proof, PAN, cancelled cheque, photograph and applicable fees to open a demat account to invest in LIC IPO.

How to Buy LIC IPO for Policyholders?

After opening the demat account, visit your profile on the DP's platform. While navigation process may vary from company to company, you would want to look at the IPO section on the platform you are navigating through.
Click on the option and select the LIC IPO tab, after which you would want to look for the policyholder category. Enter your details, place a bid and click on the submit option
After this, you will receive a mandate from the participating bank. Your application process will be done once you accept this mandate
Once done, click on the 'apply now' button. Then complete the payment option by using UPI or any other online payment option to buy LIC IPO shares at discounted rates.