The government may divest further stake in the state-owned life insurer LIC in the current financial year, sources in Department of Investment and Public Debt Management (DIPAM) has informed the media on Monday.
The divestment will be through offer of sale (OFS), a method for promoters of the company to sell their shares to public. The government currently holds 96.5% in Life Insurance Corporation (LIC). In 2022, the government divested 3.5% in the state-owned life insurer and raised Rs 21,000 crore. A DIPAM official has said that all policyholders will be given the option to buy LIC shares in the next round of disinvestment as well.
The government has set a target of raising Rs 47,000 through disinvestment of central and bank PSUs. According to the DIPAM official, disinvestment of IDBI Bank will be completed in the current financial year.
Meanwhile, the secretary said that the Central Public Sector Enterprises (CPSEs) have distributed record `1.4 lakh crore in dividends in the financial year 2024-25. “Nearly half of the dividend went to minority stakeholders, which includes small investors and senior citizens,” said a source in DIPAM.
The DIPAM secretary has said while geopolitical developments are taking the world markets by storm, the Indian government is doing its best to cushion its impact on minority stakeholders.
“It is our Prime Minister’s vision that the wealth of Public Sector Enterprises should be shared with the citizens and our PSUs are leading by example in pursuit of that vision,” said a DIPAM official.
The Indian government recently raised around `3,700 crore by divesting 2.8% of stake in Mazagon Dock Shipbuilders through an Offer for Sale (OFS). The government has asked Public Sector companies to act as a role model in stock market and distribute at least 30% of their profit after tax or 4% of their networth, whichever is higher, to their shareholders.