By Admin 
Government stake sale: The Government of India is preparing to sell a large part of its stake in LIC (Life Insurance Corporation of India) and five other public sector banks. This step is being taken according to SEBI rules, under which promoters should not have more than 75 % stake in listed companies.
At present, the government’s share in these institutions is more than 90 percent, which is more than the limit of SEBI. Currently, the government has a 96.5 percent stake in LIC. SEBI has fixed deadline for this till 2027.
LIC will have to fulfill this rule
In the year 2022, the government sold only 3.5 percent stake in LIC through IPO. The government is still holding 96.5 percent stake in LIC. The market cap of Life Insurance Corporation of India is 5.66 lakh crores.
According to SEBI rules, LIC will have to complete the rule of 10 % minimum public shareholding. For this, time was given till May 2024, but now it has been increased to May 2027. At the same time, if you talk about its share, then on Monday, LIC shares are trading at Rs 895.60 with a decline of 1.86 percent.
Along with the LIC, the government is planning to reduce its stake in five public sector banks, which has more than 75 % share. These banks include:-
- Indian Overseas Bank – 94.61 percent
- UCO Bank – 90.95 percent
- Punjab & Sindh Bank – 93.85 percent
- Central Bank of India – 89.27 percent
- Bank of Maharashtra – 79.60 percent
Banks earned a lot of profit in the first quarter
According to SEBI rules, the government will have to bring its share in these institutions at 75 percent or less by August next year. It is expected that only Bank of Maharashtra will be able to complete this time limit. Other banks may need to extend the deadline.
In the June 2025 quarter, all these public sector banks made a record profit of 44,218 crore, which is 11 percent more than the same quarter last year. In view of this strong performance, the government is now preparing to appoint merchant bankers to sell stake.
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