The Stunning Scale of India’s Biggest IPO Ever

State-owned Life Insurance Corp. of India, with its distinctive blue and yellow logo, is ubiquitous across the country of 1.4 billion people. LIC controls nearly two-thirds of the Indian market, with about 282 million policies and more than 1.3 million agents, 100,000 employees, 2,000 branches and 1,500 satellite offices. The government sold a small stake in LIC in May in India’s biggest-ever initial public offering, part of Prime Minister Narendra Modi’s plans to expand the nation’s capital markets and modernize the economy.

The long-delayed IPO was the biggest chunk of a $10.4-billion asset-sale program to plug India’s budget deficit. The government plans to push borrowing to a record as it tries to spend its way out of a Covid-19-induced downturn, and as rising fuel prices force it to spend more on subsidies. The IPO paved the way for future sales when cash is needed, although the government said it won’t sell another stake for at least a year. By forcing the 65-year-old insurer to open its books and making it accountable to public shareholders, the government hopes it can better compete with more nimble private insurers.