LIC OFS 2026: Govt to sell 6.5% stake at ₹382

What has been announced

The President of India, acting through the Department of Financial Services under the Ministry of Finance, has announced an Offer for Sale (OFS) of shares in Life Insurance Corporation of India (LIC). The stated purpose of the OFS is to reduce the promoter’s stake and increase public shareholding in the insurer. The divestment can be as high as 6.50% of LIC’s total issued and paid-up equity share capital, depending on demand. The offer is scheduled across two trading days, August 4-5, 2026. The floor price for the OFS has been fixed at ₹382 per equity share. Retail investors will be eligible for a discount of ₹10 on the cut-off price.

Offer size and structure: base and oversubscription

The OFS has been structured with a base offer size and an oversubscription option. The base offer size is up to 31,62,49,885 equity shares, representing 2.50% of LIC’s total paid-up equity share capital. In addition, the seller has an oversubscription option to sell up to 50,59,99,816 equity shares, representing 4% of the total equity capital. Taken together, the base offer and oversubscription option represent up to 6.50% of LIC’s total issued and paid-up equity share capital. The seller in this OFS is the President of India.

Key dates, bidding windows, and trading hours

The OFS will run over two trading days with separate participation windows for investor categories. Non-retail investors can place bids on August 4, 2026 (T day). Retail investors can place bids on August 5, 2026 (T+1 day), and non-retail investors who choose to carry forward un-allotted bids can also participate on T+1 day. The bidding window on both days will be from 9:15 a.m. to 3:30 p.m. IST. These timelines define when orders can be placed on the exchanges under the OFS mechanism.

Floor price and retail discount

The government has set a floor price of ₹382 per equity share for the offer. Retail investors will be eligible for a discount of ₹10 on the cut-off price. This discount applies specifically to the retail category as defined for the OFS. The disclosure also defines retail investors as individuals placing bids up to ₹2,00,000. The combination of a stated floor price and a retail discount is a central feature of the offer terms.

Employee portion: size and limits

Alongside the main OFS, an additional allocation may be offered to eligible LIC employees. Up to 50,00,000 equity shares may be offered to employees, which the disclosure equates to 0.04% of LIC’s total paid-up equity capital. Eligible employees can bid for shares up to a total value of ₹5,00,000. The disclosure also states that individual allotments will be capped at ₹2,00,000, subject to approval by the competent authority. This employee allocation is separate from the base and oversubscription components of the OFS.

Bidding and settlement conditions for investors

The OFS terms include specific conditions that can affect execution and allotment. The seller reserves the right to withdraw the offer before its opening. The offer may also be cancelled if sufficient demand from non-retail investors is not met. It may be cancelled in case of settlement defaults as well. For participation, bidders in the non-retail category are required to deposit 100% of the bid value upfront, as per the disclosed conditions.

Intermediaries involved in the OFS

The seller’s brokers appointed for the transaction include IIFL Capital Services Limited, BNP Paribas Securities India Private Limited, Goldman Sachs (India) Securities Private Limited, and Motilal Oswal Investment Advisors Limited. These intermediaries typically facilitate the OFS process on the exchanges and support the order collection and related mechanics. The disclosure identifies them specifically as the seller’s brokers for the offer.

Background context from LIC’s market history and disclosures

LIC’s equity shares are listed on both BSE Limited and the National Stock Exchange of India Limited. The provided material also contains historical IPO-related details, including an issue size of ₹20,557 crore (as per the post-offer report filed with SEBI), and a subscription level of 2.4374 times (excluding anchor investor portion and after removing multiple and duplicate bids and technical rejections cases). It also lists the issue price as ₹949 per equity share. The listing date mentioned is 17-May-22, with BSE as the designated stock exchange.

Separately, LIC informed the exchanges about an analyst/investor conference call and presentation scheduled on February 05, 2026 at 7:00 p.m. IST, citing Regulation 30 and 46(2) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (as amended). The communication was signed by the company’s Company Secretary and Compliance Officer, and indicated that the presentation would be made available on the corporation’s website.

Key numbers at a glance

IPO reference data mentioned in the disclosure

Why the OFS matters for shareholders and markets

The OFS is intended to reduce the promoter’s stake and broaden public shareholding, which can change the shareholding mix of a listed company. The two-day structure differentiates participation for non-retail and retail investors, and the requirement of a 100% upfront deposit for non-retail bidders sets a defined funding condition. The floor price and the retail discount are explicit pricing parameters that investors will reference when placing bids. The presence of an oversubscription option indicates that the final quantity sold may depend on demand, within the disclosed ceiling.

Conclusion and what to track next

The government’s OFS in LIC is scheduled for August 4-5, 2026, with a base size of 2.50% and an oversubscription option that takes the potential divestment up to 6.50% at a floor price of ₹382 per share. Retail investors have a ₹10 discount on the cut-off price, and an employee portion of up to 50,00,000 shares is also included subject to stated limits. Investors will watch how bids come in across T day and T+1 day, and whether the seller exercises the oversubscription option under the disclosed conditions.