The institutional portion of the LIC OFS, the government’s offer for sale in Life Insurance Corporation of India, was subscribed 3.32 times on its opening day, prompting the government to exercise a greenshoe option that expands the size of the stake sale.

BSE data showed the institutional and high-net-worth investor portion of the OFS was subscribed 331.86 percent on Tuesday, with total bids of about 94.45 crore shares against a base offer of roughly 28.46 crore shares, at a floor price of 382 rupees per share.

Citing the strong demand, the Department of Investment and Public Asset Management said the government would exercise the greenshoe option for an additional 50.6 crore shares, equal to 4 percent of LIC’s paid-up equity. Combined with the base 2.5 percent stake, the total offer size rises to about 82.22 crore shares, or 6.5 percent of the company, making it one of the largest secondary share sales on an Indian stock exchange.

In a post on X, the DIPAM secretary said the offer received an overwhelming response that reflected robust investor confidence and the depth of India’s capital markets, and urged retail investors to take part in Wednesday‘s bidding.

Retail investors and eligible LIC employees can bid on August 5 at an effective price of 373.10 rupees per share after a 10 rupee discount, while the cutoff price for non-retail investors remains 383.10 rupees. Ten percent of the enlarged offer, or about 8.22 crore shares, is reserved for retail investors, with up to 50 lakh shares set aside for eligible employees.

LIC shares fell 7.86 percent to close at 391 rupees on the BSE on Tuesday and dropped 8.68 percent to 391.30 rupees on the NSE, as the stock market absorbed the scale of the new supply. The government has raised 21,082 crore rupees so far this fiscal year through stake sales in seven public sector companies and remittances from the Specified Undertaking of the Unit Trust of India.