‘LIC will Have to Prune Stake in ITC & L&T to 15%’

The Economic Times - - Money -

Mu mb a i : Life In­sur­ance Cor­po­ra­tion of In­dia will have to prune its stake in two com­pa­nies — ITC and L&T — to 15% in two years, said a se­nior Irda of­fi­cial.

The in­surer re­cently raised its stake in cig­a­rette maker ITC by 2% to 16.3%, and has also sought the In­sur­ance Reg­u­la­tory Devel­op­ment and Au­thor­ity (Irda’s) per­mis­sion to in­crease its stake in In­dia’s big­gest en­gi­neer­ing com­pany Larsen & Toubro by an­other 5% to 20.7%. “Since LIC was buy­ing out SUUTI’s stake in these two scrips, the gov­ern­ment would have got the money,” said Irda mem­ber, life, Nilesh Sathe. “We have given two years’ time to LIC to bring down its stake and hope they are able to do so. We do not want dis­rup­tions in the mar­ket while they re­duce their stake. If they need more time, we are ready to con­sider that,” he said.

Ear­lier this year, Irda had asked In­dia’s big­gest life in­sur­ance com­pany for a roadmap on re­duc­ing its eq­uity ex­po­sure in listed en­ti­ties.

LIC can con­tinue its strate­gic in­vest­ment in other com­pa­nies be­yond 15% as usual, said Sathe. He added that the in­sur­ance reg­u­la­tor does not want any dis­rup­tion in the mar­ket due to LIC’s de­ci­sion to sell stake, and that it is even willing to give the in­sur­ance com­pany more time to prune its stake to 15% on a case-to-case ba­sis.

Newspapers in English

Newspapers from India

© PressReader. All rights reserved.