The New Delhi government aims at privatize the Life Insurance Corporation of India, the Asian country's public insurance giant. The Financial Times writes it today, explaining that the operation will take place with a listing on the Stock Exchange from which the public coffers aim to collect the monstrous amount of seven billion euros.
Prime Minister Narendra Modi's goal, continues the British financial newspaper, is to find the necessary funds in this way finance an expansive economic policy, more necessary than ever for the post-Covid recovery, but also for propaganda reasons, given that the governing party - the Bharatiya Janata Party - is preparing to face a complex electoral round in four states.
If indeed the listing of the Life Insurance Corporation of India yielded the equivalent of seven billion euros, it would be the new absolute record for such an operation in the Asian country. And not by little: just think that, so far, the most profitable IPO ever was the one carried out last November by the Paytm payment platform; in that case, the IPO yielded a sum of just over 1,7 billion euros, i.e. less than a third of what is expected from the public insurance sample.
On the other hand, the IPO of the Life Insurance Corporation of India is only one piece of a larger mosaic. The BJP, Modi's Hindu and Conservative party, redacted a rather ambitious privatization list. The aim is always to finance expansionary policies capable of producing economic growth and electoral support, but without increasing the public deficit too much, to avoid raising yields on government bonds.
An official valuation for shares of Life Insurance Corporation of India will only be available after publication of the prospectus. Tuhin Kanta Pandey, India's divestment secretary, announced at a conference on Monday that the documents will be filed with India's market regulator this week, in time for issuance in March.
