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LIC IPO Listing: Will this IPO become a wealth creator in the long term, or leave after making a profit in the short term? – News

LIC IPO Latest GMP, Listing Gains: The craze of the IPO of the insurance company Life Insurance Corporation (LIC) is decreasing in the gray market. This EU has also not received as much good response from investors as was expected. At present, according to market observers, the premium of LIC’s share in the gray market has come down to minus 10 rupees. LIC’s premium had crossed Rs 100 in the gray market on the first day of IPO. However, experts say that investors should not panic about the estimate of listing gains. This stock can become a wealth creator in the long run. Even if the listing is weak, then those who did not get shares in the IPO, they should buy.

GMP: The price went down in the gray market

The latest premium of LIC’s share in the gray market has come to minus 10 rupees today i.e. on 12th May 2022. Even on IPO Watch, its premium is visible at minus 10 rupees only. Earlier this week, it was at a premium of Rs 40 in the gray market. Whereas on the first day of the IPO, on May 4, its premium reached Rs 105 in the gray market. At present, the share is at a price of minus 10 rupees in the gray market. From this perspective, if the upper price band is Rs 949, the stock can be listed at Rs 939 with a weakness of Rs 10.

Make fresh investments on weak listings

IIFL’s VP-Research, Anuj Gupta is positive about LIC’s stock. He says that the stock market is to be listed on May 17, by then the trend may also change. But even if this does not happen and the stock is listed at a discount, then do not panic. The investors who got the shares should stay in it for a long time. For those who did not get it, a weak listing will be like an opportunity. If you get shares at a lower price than the issue, then you should invest afresh for a long period.

long term player

Anuj Gupta is considering it as a long-term player. He says that the future of the insurance sector in the country is better. LIC has more than 60 percent market share in this sector. Product portfolio is strong. LIC is present in some form or the other in the portfolio of many people. The focus of the company is now increasing in big cities as well. The best part is that the company has kept the valuation reasonable for the IPO. It is attractive compared to Pierce. Valuation itself had become a concern for many IPOs that came in the past.

Santosh Meena, Research Head, Swastika Investmart Ltd also believes that LIC is a long term player. He says that in terms of valuation, it is at a discount compared to the listed Indian peers as well as the global peers. LIC is synonymous with insurance in India and has got a huge competitive advantage in terms of brand value. However, there are concerns with LIC like losing market share, lower profitability and revenue growth as compared to private companies.

How has been the response of investors

Talking about subscription, the issue of LIC is 2.95 times i.e. about 295 percent. The reserve portion has received a good response for employees and policyholders. The reserve quota for employees is filled about 4.40 times. While the reserve quota for policyholders has received 6.11 times the bids. The share of QIB is 2.83 times, that of NII is 2.91 times and the reserve quota for retail investors is filled at 1.99 times.

(Disclaimer: Investment advice is given by experts. These are not the personal views of Markets are risky, so take expert opinion before investing.)

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