LIC mega sale: Insurer to sell land, buildings to raise up to $7 billion

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₹50,000-60,000 crore, the two people said. LIC, India’s biggest insurer and the largest investor in its stock market, owns assets worth over ₹51 trillion. “For the formal asset sale process, a fresh valuation work for the LIC-owned buildings may be carried out," said the second person.

Many LIC buildings have never seen any sale transaction and their market value is not known, the person said, adding the actual value may be "at least five times more than the conservative one," which works out to be around ₹2.5-3 trillion. Emails sent to LIC, department of investment and public asset management (Dipam) and the department of financial services remained unanswered. Dipam's approval is mandatory for asset divestment processes of all government-owned firms.

LIC clocked ₹40,676 crore net profit in FY24 compared to ₹36,397 crore in FY23, as renewal premiums improved, investments earned better returns, and value of new business (VNB) inched up. LIC will pay its shareholders a dividend of ₹6 for FY24. If the property sale plans go through, it may lift LIC's profit and potentially lead to better dividends.

According to the second person, a new owner may redevelop, redesign or utilize the buildings in different ways. LIC may consider forming a separate entity to hold the real estate assets and manage their monetization, the first person said, pointing to the challenge in valuing these assets. He said LIC also owns the famous State Bank of India building at Mall Road in Mussourie, Uttarakhand; and two separate buildings forming headquarters of prominent media houses in New Delhi and Lucknow.

“There are many such so-called marquee properties the insurer owns. But the valuation has to be done appropriately. The price discovery can