India’s government opened a two-day sale of shares in Life Insurance Corporation on Tuesday, offering to sell up to a 6.5 percent stake in the state-run insurer at a floor price of 382 rupees per share.

The offer for sale, or OFS, opened to non-retail institutional investors on Tuesday and will open to retail investors on Wednesday. The floor price represents roughly a 10 percent discount to LIC’s closing price of 424.35 rupees on Monday, and shares fell as much as 8 to 9 percent in early trading Tuesday as the market absorbed the new supply.

The base offering covers 2.5 percent of LIC’s equity, with an additional 4 percent available through a green shoe option that the government can exercise depending on investor demand. If the sale is fully subscribed, including the green shoe portion, the government stands to raise close to 31,000 crore rupees, or roughly $3.7 billion, for its disinvestment program covering the current fiscal year.

The stake sale also moves LIC closer to compliance with a market regulator requirement that all listed companies maintain a minimum public shareholding of 10 percent. LIC, which listed on Indian exchanges in 2022, has been working toward that threshold ahead of a May 2027 deadline set by the Securities and Exchange Board of India.

LIC remains India’s largest insurer by both market share and assets under management, and the government has continued to hold a controlling stake in the company since its initial public offering. Tuesday’s OFS is among the largest single share sales India’s disinvestment program has attempted this fiscal year, and analysts said the pricing discount reflects an effort to ensure the offering is fully absorbed by the market within the two-day window. The sale also comes as Indian banking stocks have come under separate pressure this week ahead of a Reserve Bank of India monetary policy announcement, with investors weighing inflation data and regional geopolitical tensions alongside the fresh supply of LIC shares hitting the market.