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5 August 2026

LIC share price dip following stake sale

The stake sale in a major public sector entity like LIC serves as a practical example of the government's disinvestment policy and liberalization efforts, providing useful context for questions on economic reforms and public sector management.

1 min read Day 1 of 2 1 questions 1 prelims

Notes

  • LIC share price declined by approximately 8% on the BSE, closing at ₹391 per share.
  • The decline followed the Government of India's decision to sell a 6.5% stake in LIC via an Offer for Sale (OFS).
  • The OFS was executed at a 10% discount to the prevailing market price.
  • The OFS structure included a base offer of 2% equity stake and an additional 4.5% stake option.
  • This stake sale occurred four years after LIC's initial public offering (IPO), which raised ₹21,000 crore for a 3.5% stake.

Part of a longer story

This is day 1 of 2 in LIC government stake sale and share price performance, which has been running since 5 August 2026. Reading it whole is usually worth more than reading today alone — the exam asks how something developed.

Questions

  1. Discuss the significance of Offer for Sale (OFS) as a mechanism for disinvestment in Public Sector Undertakings (PSUs) and its impact on market valuation. 150 words
    Attempt this — 150 words in 8 min
    0 / 150 words 8:00

Prelims

  1. Which of the following best describes the 'Offer for Sale' (OFS) mechanism used by the government for disinvestment?

Syllabus

Topics

Sources

250words.in · https://250words.in/daily/2026-08-05/lic-share-price-dip-following-stake-sale