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Investing.com — The much-awaited IPO of the country’s largest insurer LIC, initially set to launch in late March 2022, is now set to defer to the next financial year FY23, amid the high volatility in markets led by the aggravating Russia-Ukraine crisis.
Sources privy to the matter have suggested that bankers and officials related to IPO developments are making preparations to shift the country’s biggest IPO ever to the next financial year, amid wild market swings.
Officials requesting anonymity have informed that a formal announcement of the same could come anytime over the next 1-2 weeks, with a high probability of the sale going live in April, if market volatility subsides, cited a Bloomberg report.
Furthermore, many fund managers connected to the event are allegedly keeping away from making major commitments, in tandem with the current market scenario.
The ongoing geopolitical disturbance has impacted market valuations globally.
Market capitalization of the ‘supermajor’ British oil & gas company BP (LON:) has been eroded by 6% since the tensions between Russia and Ukraine have broken out, while the global market cap is wiped out by over $3 trillion.
Consequently, an economic event as important as the LIC IPO is bound to be impacted by the Russia-Ukraine war.
The event deferring to FY23 will impact the government’s annual disinvestment targets of FY22, revised at Rs 78,000 crore, of which Rs 60,000 crore is yet to be met by the LIC IPO.
Speaking about the impact of delaying LIC IPO due to geopolitical unrest, FM Sitharaman in a recent interview with the Business Line said, “When a private sector promoter takes this call, he has to only explain this to the company’s board, but I would have to explain it to the whole world.”
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