Saturday, Sep 20, 2014

Against listing on bourses: LIC to FM

The issue of listing of LIC had come up during a meeting of financial sector chiefs with Arun Jaitley last week.(PTI) The issue of listing of LIC had come up during a meeting of financial sector chiefs with Arun Jaitley last week.(PTI)
Written by George Mathew | Mumbai | Posted: June 21, 2014 2:56 am | Updated: June 21, 2014 10:13 am

State-run Life Insurance Corporation (LIC) is against diluting its present character and listing the entity on the stock exchanges and has conveyed it to finance minister Arun Jaitley.

A senior official, who is on the board of LIC said, “I don’t see any reason for listing of its shares. Why should LIC be listed? It makes sense for the government to retain its current character.”

The issue of listing of LIC had come up during a meeting of financial sector chiefs with Jaitley last week. Kotak Mahindra group chief Uday Kotak had suggested that the government should look at listing LIC as it can generate a lot of revenue. Kotak had argued that the kind of money the government can raise by listing LIC is significant and it can fund needs of public sector banks as well as fiscal deficit.

Jaitley then sought LIC chairman SK Roy’s opinion on the issue. “While Kotak has many reasons for listing LIC, I don’t have any reason to list the corporation,” Roy reportedly told the finance minister.

Kotak persisted with the listing issue and said the Centre can really reap a huge windfall by listing the corporation which is valued more than Rs 10 lakh crore. However, Roy said LIC’s asset size exceeds Rs 18 lakh crore. “If government wants to make Rs 18 lakh crore into a Rs 10 lakh crore organisation, it can do that,” Roy said.

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