The country’s largest initial public offering (IPO) of Life Insurance Corporation (LIC) is set to be opened on May 4 and will close on May 9. The anchor book is slated to open on May 2 but the issue will open for retail investors two days later, as May 3 is a holiday on account of Eid.

Investment bankers said that the government has cut the issue size to Rs 21,000 crore and the issue is now valued at 1.1 times its embedded value of Rs 5.4 trillion. In September 2021, the government had appointed Milliman Advisors to value the country’s largest insurer and arrived at an embedded value of Rs 5.4 trillion. Embedded value is the measure of consolidated shareholder value of an insurer. Historically, listed private sector insurers have traded at 2-3 times their embedded value.

Market experts said the valuation leaves a lot on the table for investors.

The issue size was cut from the earlier proposed Rs 65,000 crore as market conditions turned negative after Russia attacked Ukraine, sending financial markets into a tizzy.

In March this year, market experts had urged the government to price the public issue at attractive valuations for it to sail through in the current market conditions. With better pricing and 10 million policy-holders opening demat accounts to get a further discount on the IPO price, the issue would not hit hurdles, bankers feel.

LIC had filed its draft papers for IPO on February 13. The government had time till May 12 to launch the IPO without filing fresh papers with the Securities and Exchange Board of India.