FIs bid for GAIL, IBP issues at floor price

Domestic financial institutions such as the Life Insurance Corporation of India (LIC), the General Insurance Corporation of India (GIC) and its four subsidiaries, and the Unit Trust of India (UTI) have applied for IBP and GAIL India Ltd shares at the floor price of Rs 620 and Rs 185, respectively.

The two institutions had earlier received board approvals to apply for 10-15 per cent of the shares on sale through the government's divestment process.

LIC has already applied for the GAIL issue, which is scheduled to close on March 5.

"We have subscribed to almost all the issues at floor price "" such as IBP, IPCL and GAIL," said R N Bharadwaj, managing director, LIC, and in-charge of investments.

GIC has also taken a decision to jointly bid with LIC. Bharadwaj said LIC was a net seller in the equity market for quite some time now. "We have enough funds to participate in these three issues."

According to him, the floats provide the perfect opportunity to invest surplus funds.

Meantime, the IBP share ended at Rs 661.85 on the National Stock Exchange today, while GAIL closed at Rs 204.05.

Mutual funds and UTI hold around 4.11 per cent in IBP, while banks and FIs have 6 per cent stake.

LIC also holds around 3.86 per cent in CMC, shares of which too were on offer today. GIC, New India Assurance and Oriental Insurance Company have 2 per cent, 2.13 per cent and 1.22 per cent, respectively, in the IT company.