LIC needs more efforts to be true market player: Tuhin Kanta Pandey

NEW DELHI: In a bid to prove itself as a true market player, Life Insurance Corporation (LIC) will have to do many fresh things from a long-term perspective and the management needs to strategise for the next twenty years, Tuhin Kanta Pandey, Secretary at the Department of Investment and Public Asset Management (DIPAM), said on Friday. 

He said that the actual work starts after the listing process and it needs to redouble efforts to show itself as a true market player. “It’s a competitive world. Whether its investments, their portfolios, mix of their policies, margins, human resource … they need to keep doing things. The work actually begins after listing. Listing isn’t an end itself,” Pandey told The New Indian Express, when asked if he has seen changes in the government-owned life insurer’s operations after the listing. The government raised Rs 21,000 crore by selling 5% equity shares of LIC through an Initial Public offer (IPO) in May this year. 

With regard to the strategic disinvestment of Bharat Petroleum Corporation Ltd (BPCL), the secretary stated that the government is looking for the opportune time to launch the EoI for its bidding process. The Centre had to call off the EoI of BPCL earlier, as most bidders expressed their inability to participate in the bidding process. “A lot of turmoil happened in the oil industry in the last two years.

Energy transition is one of the major issues in this particular sector. Investors have some concerns as it is more linked with the climate change…Ukraine crisis also took its toll besides other issues,” Pandey stated. He further added that as BPCL is a big investment, investors due to these multiple factors didn’t feel confident enough to proceed with the disinvestment.

Meanwhile, he said the government will come up with EoI of the former subsidiaries of Air India Air Transport Services (AIATSL) and Air India Engineering Services (AIESL). There are several potential buyers for AIATSL, which is a ground handling firm and AIESL (engineering services), he added.  Both these companies were transferred to the government’s wholly-owned Air India Asset Holding Company (AIAHL) and were not the part of Air India disinvestment.

In addition, on privatisation of two banks as announced in the Budget 2022, Pandey said the Centre has to decide on the timing. Also, some amendments need to be done in the banking legislation before moving towards the privatisation of these banks.