Russia-Ukraine war to delay LIC IPO launch? FM Nirmala Sitharaman makes big statement

Nirmala Sitharaman said 'ideally' the government would like to go ahead with the IPO. However, if global circumstances demand, the FM said she won't hesitate to look into it again.

The central government is likely to review the timing of launching the initial public offering (IPO) of LIC amid the ongoing war between Russia and Ukraine, Finance Minister Nirmala Sitharaman has said.

In an interview with the Hindu BusinessLine, FM Sitharaman said, "When I last commented on this matter, the tension was building up. Now there’s a full-scale war. Therefore, I need to go back and review the situation."

She said 'ideally' the government would like to go ahead with the much awaited mega IPO. However, if global circumstances demand, the FM said she won't hesitate to look into it again.

The conflict in eastern Europe has impacted global stock markets, including the BSE Sensex and NSE Nifty, and international oil prices. Several experts have cautioned that global inflation level may go up due to Russia's invasion of Ukraine.

Last week, the Union Cabinet chaired by Prime Minister Narendra Modi permitted up to 20 per cent foreign direct investment (FDI) under automatic route in IPO-bound LIC with the aim of facilitating disinvestment of the country's largest insurer.

Setting the stage for the country's biggest-ever public offering, Life Insurance Corporation on February 13 filed draft papers with capital market regulator Sebi for the sale of 5 per cent stake by the government for an estimated Rs 63,000 crore.

The initial public offering (IPO) of over 31.6 crore shares or 5 per cent government stake is likely to hit D-street in March. Employees and policyholders of the insurance behemoth would get a discount over the floor price.