The government is likely to sell a 3.5 per cent stake in Life Insurance Corporation (LIC) through an initial public offering which will hit the markets in the first week of the next month, an official said.

The issue size is expected to be worth Rs 21,000 crore, valuing the country’s largest insurer at Rs 6 lakh crore.

LIC is likely to file the red herring prospectus with market regulator Sebi by Wednesday.

“LIC IPO is likely to come to the market in May first week. 3.5 per cent stake dilution, subject to regulatory approval,” an official said.In February, LIC had filed draft papers with Sebi wherein it had said that the government will sell 5 per cent stake or 31.6 crore shares in the state-run insurer.

However, the IPO plans faced headwinds due to the ongoing volatility in stock markets due to Russia-Ukraine war, forcing the government to cut the issue size to 3.5 per cent.

Reservations for policyholders and employees, and discounts, issue dates and issue price will be known by Wednesday, the official added

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