LIC stock falls 8% on listing day

After Reliance Industries, TCS, HDFC Bank, and Infosys,

the Indian equities markets now have another giant. 

Life Insurance Corporation of India (LIC)

was among the top five most valuable corporations on the day of the IPO. It successfully surpassed another PSU, State Bank of India, and ICICI Bank to take fifth place, consolidating its status as the most valuable PSU and among the top financial heavyweights. It now has a market capitalisation of 5.48 lakh crore.

Due to selling pressures and a bad market attitude, its stock slid 8.6% on the first day of trading to $867, down from $949, the issue price. This decline, on the other hand, indicates the dismal market conditions and was widely foreseen by analysts and the unofficial grey market. 

For the past two months, the equities markets have been battered, but the biggest shock came earlier this month when the central bank boosted benchmark interest rates to combat growing inflation. Other macro data that followed were also uninspiring, prompting experts to forecast a "series of moves" to tighten liquidity in the system.

Analysts had since given up hopes of a strong listing price. On May 16,

Aayush Agrawal,

senior analyst at Swastika Investmart said “We anticipate that LIC might have a flat listing tomorrow, based on the current market situation. Due to increased inflation statistics, FII outflows, currency weakness, geopolitical and rate hike-related worries, present markets are experiencing extraordinary volatility, this has caused sell-offs in equity markets all over the world.”