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LIC’s paid-up capital stands at ₹6324 cr
February 09, 2022
Life Insurance Corporation (LIC) didn’t pay any dividend to the government in the last financial year and used the free reserves to expand its paid-up capital, which has now risen to ₹6,325 crores, the government told Rajya Sabha on Tuesday.
In the 2019-20 fiscal, the insurance behemoth, which is set for an Initial Public Offer (IPO), paid ₹2,610.75 crore as profit to the government from profits pertaining to FY 2018-19.
Referring to information got from LIC, Minister of State for Finance Bhagwat Karad said no profit was paid in FY 2020-21 as the Insurance Regulatory and Development Authority of India (IRDAI) had instructed insurers to refrain from dividend pay-outs from benefits relating to the financial year ending March 31, 2020.
The order from IRDAI came directly following the Covid pandemic so the organizations could hold cash flow to meet possibilities if any.
“Government, on an application made by LIC, allowed LIC to use the freeholds of LIC towards expanding its paid-up capital. As a result, the paid-up capital of LIC increased to ₹6,324.99 crore, as of December 31, 2021,” Karad said in a written reply.
The central government is relied upon to file draft papers for the mega IPO of LIC with market regulator Sebi [Securities and Exchange Board of India] this month. The embedded value of LIC is estimated at over ₹5 lakh crore.
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