Russia-Ukraine war will not deter LIC’s IPO plan

Mumbai: Life Insurance Corporation’s Initial Public Offering will go ahead as planned and not be impacted by the ongoing Russia-Ukraine conflict, despite heightened uncertainty in the near-term and higher volatility expected in financial markets as the war drags on.
The public offering of shares by LIC, set to be the country’s most significant, will be a test of the depth of domestic capital markets, especially when financial markets face geopolitical strife, and as the implications from the war in Ukraine is nowhere close to being clear.
With wild gyrations in financial markets expected to continue, demand for the public offering of LIC should be in play.
LIC’s IPO is India’s most anticipated, so I don’t think the Russia-Ukraine conflict will have any impact on it. Yes, the timing may not be right, but the government will do it irrespective. Any change in the plans of LIC IPO will affect the government finances, said Vaibhav Agrawal, Founder & Chief Investment Officer at Teji Mandi.
LIC’s discount offer attracted 34 lakh Demat account openings in January. This shows the enthusiasm of Dalal Street, he said.
Financial markets have been on a roller coaster ride over the past week, tracking the dramatic escalation in tensions in Europe. Safe-haven bets increased after the Russian President ordered his nuclear forces to be on high alert and Western nations responded with fresh sanctions.
This week, more pain is expected for global risk assets on heightened volatility predicted. But the volatility or risk aversion is not likely to hamper LIC’s IPO.
The government is rushing to complete the IPO by the end of March to meet its 2021/22 fiscal deficit target, which is needed to finance its fiscal expansion plans set in the budget.