Under Current Terms Only LIC is Likely to Buy Air India


India’s three main airlines, IndiGo, Jet Airways and SpiceJet, have made it clear that they are not interested in buying Air India, in the current form it is being offered in. (As I finished writing this column, a Reuters journalist tweeted to suggest that the Tatas are also unlikely to bid for Air India, as well. Guess, nostalgia, doesn’t always work). The government of India wants to:

A) Sell 76% of Air India.

B) 100% of Air India Express, the low-cost arm of Air India.

C) 50% of SATS, a gateway solution and food services provider. Against this sale, the government, wants the buyer:

a) To take on two-thirds of the debt of Air India. As on March 31, 2017, the total debt of the company was at Rs 48,447.37 crore. Two-thirds of this works out to Rs 32,298 crore.

b) The buyer also needs to give a guarantee that none of the permanent employees of the airline will be sacked for a year. After that the buyer can offer them a voluntary retirement scheme.

In return, the buyer, along with the aircrafts of Air India, will also get 2,543 international landing slots negotiated with many countries, over the years. The landing slots is for what any airline will want to buy Air India. The real estate of Air India, which includes the famous Air India building in Nariman Point, will continue to remain with the government.

What also works for the prospective buyer is that Air India has 12% market share in the domestic market in India. While, this has fallen from a 100% market share once upon a time, when private airlines were not allowed to operate in India, it needs to be taken into account that only 3% of Indians have travelled by air. Hence, the potential is immense. India is one of the last big airline markets that remains untapped.

Also, the airline has a 17% share in flights in and out of India.

All these factors work for the buyer. But there are other factors which don’t. As mentioned earlier, the airline had a debt of close to Rs 48,447 crore as on March 31, 2017. Two-thirds of this debt has to be picked up by the buyer.

The working capital loans constitute Rs 31,088 crore of this debt. This is a little lower than the amount of debt that the government wants the prospective buyer of Air India to pick up. It is worth asking how has this debt accumulated over the years? The airline loses money every year and in order to continue operating it needs to borrow.

The banks lend money to the airline because it is ultimately deemed to be lending to the government and a government doesn’t usually default. A private enterprise in the place of Air India, would have had to shut down by now.

The larger point is that by asking a prospective buyer to take on two-thirds of the debt, the government basically wants the buyer to take on the overall accumulated inefficiency of the airline.

Rs 33,298 crore is a lot of money and is basically a deal breaker as far as the sale of Air India is concerned. This kind of debt it could even bring down the airline that decides to buy Air India. (In fact, we had said the same thing in a column which appeared on January 15, earlier this year).

Other than the working capital loans of Rs 31,088 crore, the remaining Rs 17,360 crore is basically loans that have been taken for buying aircrafts. If this portion of the loan is passed on to the buyer, there is at least some justification given that there are airplanes that were bought using the loan.

Also, any prospective buyer will adjust for these loans before deciding on the price it wants to buy for Air India. But on the whole, the debt will drive away most prospective buyers.

Further, it is worth remembering that airline has lost a lot of money over the years and it continues to lose money. The airline lost Rs 41,657 crore between 2010-2011 and 2016-2017. These losses have continued in 2017-2018 (for the period between April to December 2017). Take a look at Table 1.

Table 1:

Domestic (Rs. in lakh)International (Rs. in lakh)
Traffic Revenue505,9641,044,676
Total Cost676,2311,334,296

Source: Loksabha Questions PDF 

Table 1 tells us that between April to December 2017, the airline lost a further Rs 4,599 crore. This basically means that the accumulated losses of the airline between April 2010 and December 2017, stand at Rs 46,256 crore.

Now that’s a lot of money. Other than the airline borrowing money to keep itself going, the government has also pumped in money into the airline over the years. Take a look at Table 2.

Table 2:

YearEquity Infused Rs. in (crore)
2017-18 (till date)1,800
Total Cost26,545.21

Source: Loksabha Questions PDF 

This infusion is a part of a restructuring plan which provides Rs 30,231 crore of equity infusion from the government into the airline, until 2021. It is clear that the restructuring plan is not working given that the airline continues to lose more than what the government has invested in it, over the last few years.

This isn’t surprising given that the cost of operation of the airline is very high. As a recent report by Kotak Institutional Equities points out, the operational costs of Air India are Rs 4.74 per available seat kilometre, in comparison to Rs 4.33 for Jet Airways, Rs 3.6 for SpiceJet and Rs 3.16 for IndiGo.

The airline also has a huge number of employees, backed by powerful trade unions which can be a huge nuisance. As on January 1, 2017, the airline had 18,049 employees. In comparison, IndiGo had 14,576 employees as on March 31,2017. IndiGo also employed 8,225 employees on a temporary/contractual/casual basis. Indigo has 40% share in India’s domestic airline business. Air India has 12%.

Also, 37.6% of Air India’s employees are retiring over the next five years. The trouble is that no prospective buyer will be willing to wait for five years, so that the airline can then have the right number of employees. Any quick turnaround will only happen if the buyer is allowed to fire employees.

The larger point here is that the airline is clearly not a family jewel that the government considers it to be (like all other public sector enterprises). It is basically a dangerous wound which has been bleeding the government and continues to bleed it. This bleeding needs to be stopped and it can only be stopped if the government decides to be a lot more flexible about the terms on which it is willing to sell the airline.

In fact, the government is more likely to attract bidders if it tries selling different parts of the airline, separately. For starters, the domestic business and the international business of Air India, need to be offered separately. In fact, even Air India Express, which primarily has flights to the middle east should also be offered separately. This might attract different buyers.

Further, the buyer should be allowed the flexibility of the doing what he deems fit to run the airline. The government cannot sell the airline and then want to continue running it through the backseat, by implementing terms and conditions.

Also, if this means that a few thousand Air India employees lose their jobs, then so be it. They have had a good time at the expense of the taxpayer, for many years now. This is as good a time, as any, to end it. If the government continues to run the airline, it will have to continue pumping money into it. This is money that is taken away from many other important areas like education, defence, health and agriculture. Further, the debt that the airline takes on will also eventually end up in the books of the government.

Under the current terms, the only institution that is likely to buy Air India, is the Life Insurance Corporation(LIC) of India. Given its past record under different governments in buying public sector enterprises, it won’t be surprising if the financial institution is forced to come to the rescue of the government and pick up a stake in the beleaguered airline. Funnier things have happened.

The column originally appeared on Equitymaster on April 11, 2018.

Why Are We Not Talking About Bad Loans of LIC?


On April 21, I wrote a column titled, Why It’s Best to Stay Away from Buying LIC Policies. One feedback I got on the social media, primarily from insurance agents trying to sound intelligent, was that, if we don’t have the Life Insurance Corporation(LIC) of India, who will carry out socially responsible investing.

None of these agents bothered to define socially responsible investing. But assuming that they know what it means, let me give you a very good example of what is definitely not socially responsible investing.

Let’s take the case of ITC, a company which still makes a bulk of its money from selling cigarettes. As of March 31, 2016, the LIC owned 14.39% stake in the company. As of yesterday i.e. May 9, 2016, this stake was worth Rs 37,510 crore.

What is a socially responsible insurance company doing by staying invested in a cigarette maker? In fact, in the recent past, this cigarette maker opposed the decision of the government for a larger pictorial warning on the cigarette packets.

Can these insurance agents who believe that LIC is into socially responsible investing tell the world at large what is India’s largest insurance and investment company, hoping to achieve by staying invested in a company which sells the stick of death?

Also, it is worth remembering here that the money that LIC manages and invests, are the hard earned savings of millions of Indians. And given the situation it should be managing this money in the best possible way.

But is it doing that? Take a look at the following table.

DateGross non-performing assets ratio
December 31, 20154.23%
December 31, 20143.98%
December 31, 20134.09%
December 31, 20122.97%
December 31, 20111.34%


What the above table clearly shows us is that the gross non-performing assets of LIC or bad loans, have gone up dramatically over the last five years. As on December 31, 2011, the bad loans had stood at 1.34% of the total debt portfolio of LIC.

Since then the bad loans have jumped to 4.23% of the debt portfolio of LIC. LIC buys corporate bonds and lends to the central government as well as state governments, municipalities, state electricity boards, state road transportation companies and so on.

The latest loan portfolio of LIC is not available. What is available is the loan portfolio as on March 31, 2015. This data is available in the 2014-2015 annual report of the firm. As the annual report points out: “The non-performing assets as at 31st March, 2015 are Rs12,213.37 crores out of a total debt of Rs 3,70,625.89 crores…The percentage of gross non-performing assets is 3.30%.”

The bad loans of LIC as on March 31, 2015, had stood at 3.30%. Nine months later as on December 31, 2015, they had jumped by 93 basis points to 4.23% of the total debt portfolio. One basis point is one-hundredth of a percentage.

This is a huge jump over a period of just nine months. Now compare this to the bad loans of public sector banks, which have been in the news for a while now. The State Bank of India, the biggest public sector bank reported a bad loan ratio of 5.1% of its loans, as on December 31, 2015. Syndicate Bank and Vijaya Bank reported bad loan ratios of 4.6% and 4.32%. The private sector ICICI Bank reported a bad loan ratio of 4.7%.

While the bad loans of banks have been much discussed, no such discussion seems to be happening around the bad loans of LIC. Other than an analytical piece in the Mint by Ravi Krishnan, and one newsreport in The Hindu Business Line, nothing much seems to have been written around the issue.

To put things in perspective, the loan book of LIC is pretty big. As The Hindu Business Line puts it: “LIC’s total debt” of about Rs 3,70,625 crore as of March 2015, is actually higher than HDFC Bank’s loan book of about Rs 3,65,495 crore in the FY15 fiscal.” The newspaper goes on to report that LIC has filed cases against around seventy defaulters.

While the Reserve Bank of India, the regulator of banks, seems to be taking an active interest in helping banks clean up its act, the insurance regulator, the Insurance Regulatory and Development Authority of India(IRDAI) hasn’t said anything on this front in the public domain. This is not surprising given that a former chairman of LIC is the current chairman of the insurance regulator IRDAI.

It needs to be mentioned here that LIC has the backing of the government, like the public sector banks, and hence, there is nothing to worry about. But ultimately, like has been happening with the public sector banks, the tax payers are there to pick up the tab, if the situation does spiral out of control.

The column originally appeared in the Vivek Kaul Diary on May 10, 2016

Why It’s Best to Stay Away from Buying LIC Policies


The Life Insurance Corporation(LIC) of India is India’s biggest insurance company. It is also India’s biggest investment firm.

It is so big that it keeps coming to the rescue of the government now and then, when the government cannot find enough buyers for the financial securities that it wants to sell.

Nevertheless, the question is, how good is LIC when it comes to generating returns on the investments it makes?

Before we figure that out, it is good to point out that LIC is basically an investment firm which also sells insurance. A major portion of the money that it collects as premium from Indians, against the so called insurance policies that it sells, is invested in stocks and bonds (both private as well as government).

The insurance policies that LIC sells are basically investment plans with a dash of insurance. And given that the premium that it collects and in turn invests, should be generating decent returns for the policyholders (actually investors). Of course, the tragedy is that most of these policy holders don’t even know that they are actually investors.

So how do things look? The accompanying table gives us the investment track record of LIC between 2005-2006 and 2014-2015. As is clear from the table the investment record of LIC has been dismal to say the least.

In 2014-2015, the investment firm earned a return of 7% on its investments. The average return on the 10-year government bond during the course of the year was 8.3%. The investment return of LIC was 130 basis points lower than the average return on a 10-year government bond. One basis point is one hundredth of a percentage.

YearIncome from investments (In Rs crore)Investments (In Rs Crore)Return (%)Average returns on 10 year govt bondDifference
2014-20151,35,48319,462,497.0%8.3%130 basis points
2013-20141,18,09716.846,907.0%8.4%140 basis points
2012-20131,03,88214,864,577.0%8.2%120 basis points
2011-201290,26713,495,326.7%8.5%180 basis points
2010-201177,66712,665,396.1%7.9%180 basis points
2009-201067,19810,958,416.1%7.3%120 basis points
2008-200956,5838,15,4846.9%7.6%70 basis points
2007-200847,9997,56,8916.3%7.9%160 basis points
2006-200740,5726,13,2676.6%7.8%120 basis points
2005-200635,4795,24,0176.8%7.2%40 basis points
Source: LIC annual reports and www.investing.com

[These numbers may not reflect mark-to-market on certain investments and hence the investment income may be higher, though it cannot meaningfully alter the returns.]

In fact, the difference between the average returns on a 10-year government bond during the course of a year and the investment returns of LIC vary between 40 basis points and 180 basis points. This is a huge difference.

The average return on investment for LIC over a period of ten years between 2005-2006 and 2014-2015 has been 6.7%. The average return on a ten-year bond has been 7.9%. The difference between the two returns is 120 basis points.

In fact, the average rate of inflation between 2005-2006 and 2014-2015 was 8.85%. Hence, the average return on investment of LIC was lower than the rate of inflation as well.

What does this tell us about a professional investment firm like LIC? It tells us that LIC is doing a terrible job of managing public money. Any investment firm should be able to generate average returns greater than the returns on government bonds, at least.  It should also be able to beat the inflation. In fact, that is what it is paid a fee for. But that doesn’t seem to be happening in case of LIC.

The investment returns of LIC have been consistently lower than the 10-year government bond returns. First and foremost, this tells us that the investment management capabilities of LIC are very bad, given that its investment returns have been 120 basis points lower than returns on a 10-year government bond, over a period of ten years.

Further, LIC would be simply better off by buying government bonds and then holding on to them till maturity, instead of actively trying to manage money. It would probably end up earning higher returns than it currently does.

Second, what this also tells us is that the government is interfering too much in the functioning of the firm and getting it to make investments, which it shouldn’t be making in the normal scheme of things. The government regularly gets LIC to invest in shares of public sector enterprises which other investors are not willing to pick up.

In the recent past LIC has picked up stakes in public-sector banks to help them meet their capital requirements. As a March 29, 2016, news-report in The Indian Express points out: “Since the beginning of 2016, LIC has brought into preferential allotment of as many as six banks, supporting the fund-raising requirement of these banks in turn. Share prices of PSBs on an average have declined close to 11.7% so far this year.”

The public-sector banks are sitting on a huge corporate-debt time bomb. Many corporates they have lent to over the years are currently no longer in a position to repay their loans or have simply siphoned off this money. The question is why is LIC money being invested in these banks? This is because the government wants to continue owning these banks, instead of selling them out.

Also, LIC now owns 21.22% of Corporation Bank, 14.37% of IDBI Bank and 14.99% of Dena Bank. Again, the question, why should an investment firm managing public money be taking on such concentrated risk? In fact, the Securities and Exchange Board of India(Sebi) regulations do not allow a mutual fund to own more than 10% of a company.

Why doesn’t the same rule apply to LIC as well? Like mutual funds LIC is also in the business of managing hard-earned public money.

Unnamed LIC officials in various news-reports justify this buying by saying that they are buying value. Maybe they are, but buying value does not mean betting the house on one stock. When an institution is managing as much money as LIC is, some basic investing principles need to be followed.

Third, it tells us that individuals are better off putting their money somewhere else rather buying LIC policies. What is the point in investing money in order to earn a return of 6-7% on an average? Yes, investing in LIC policies helps people save on tax, but there are better ways of saving tax like the Public Provident Fund(PPF).

Between 2009 and now the returns on PPF have never gone below 8%. In fact, currently the rate of interest on PPF is at 8.1%. As far as an insurance cover is concerned, individuals can look at buying a pure term insurance policy, which just offers insurance against the premium paid.

Fourth, the government needs LIC to finance its fiscal deficit and to keep rescuing the public sector enterprises which aren’t a viable business anymore. Fiscal deficit is the difference between what a government earns and what it spends. LIC helps the government finance its fiscal deficit by buying government bonds and at the same time it also helps the government meet its disinvestment target by buying shares of public sector enterprises which other investors are not interested in. This money helps narrow the fiscal deficit.

In the process, the returns that LIC is able to generate on its investment portfolio get compromised on.

Fifth, when was the last time you saw an article analysing the returns on various LIC policies?  Like is the case with other insurance companies, it is not possible to figure out which LIC plan has given what kind of return, over the years. Hence, it is best to stay away from investing in them.

The column originally appeared on Vivek Kaul’s Diary on April 21, 2016

How insurance companies robbed the hard earned savings of Indian investors

The Report of the Committee to recommend measures for curbing mis-selling and rationalising distribution incentives in financial products was released on September 3, 2015.

The financial product which is perhaps most mis-sold in India is insurance. There is enough anecdotal evidence to suggest that hordes of investors bought equity unit linked insurance plans (Ulips), over the years, on the mis-sell that their investment would double in three years. Ulips are primarily investment plans with a dash of insurance.

Ulips, as they used to be structured, paid a very high commission to insurance agents during the first two years of the policy. Also, in case the investors failed to pay the premium during the first three years of the policy, the insurance company was allowed to keep the entire premium that had been invested up until then.

As the report cited at the beginning of this column points out: “The regulation on a three-year lock in period which allowed companies to keep the entire value of the policy if surrendered within three years, left very little incentive to the insurance companies to promote follow-on premium payments from their customers. The rule on front-loaded commissions, which were as high as 40 percent in the first year, incentivised agents to sell products that earned them the highest pay-off.”

In fact, an estimate made by Monika Halan, Renuka Sane, and Susan Thomas in a research paper suggests that investor losses due to policies lapsing mounted to Rs 1.5 trillion between 2004-06 and 2011-12.

This is a huge amount of money. Many investors stopped paying their premiums after the money they had invested did not double in three years. Over and above this, the insurance agents sold Ulips as a three year policy, instead of telling the investors that there was a lock-in of three years.

At the end of three years they got people to invest their redeemed amount back into a fresh Ulip. This was done so as to ensure that they (i.e. the agents) could continue to earn a high commission.

In fact, in a research paper titled Understanding the Advice of Commissions-Motivated Agents: Evidence from the Indian Life Insurance Market, Santosh Anagol, Shawn Cole and Shayak Sarkar point out: “We find strong evidence that commissions-motivated agents provide unsuitable advice. Depending on our treatment, agents recommend strictly dominated, expensive products, 60-90% of the time.”

Also, not surprisingly, the research paper points out that “the selling of unsuitable products is likely to have the largest welfare impacts on those who are least knowledgeable about financial products in the first place.”

This is also visible in the low persistency that insurance policies have in India. As the report of the committee to recommend measures for curbing mis-selling points out: “A manifestation of this is the low persistency of policies in India. Persistency tracks the behaviour across time of policies sold in a year. The 13 month persistency rate for insurance companies ranged between 41 – 76 percent in 2013-14. In the case of LIC [Life Insurance Corporation of India] for example, the 61st month persistency in 2013-14 was just 44 percent. This means that less than half of the policies sold in FY 2009 were retained.”

The low persistency is primarily because of “mis-selling and poor service by agents.”

The question is what can be done to curb this mis-selling. The Insurance Regulatory and Development Authority (IRDA) of India has cut down on Ulip commissions over the years. Nevertheless, high commissions on the traditional endowment plans still remain. If mis-selling has to come down, the commission on endowment plans needs to be slashed.

In fact, as the report on curbing mis-selling points out: “The Insurance Laws Amendment Act, 2015 has led to the removal of the ceiling of 40 percent on the maximum commission, fee or remuneration. IRDA for now has the power to lay down the structure of commission/brokerage for intermediaries as well as the power to determine the expenses of management.”

The question is will IRDA implement this and start limiting the commissions paid on traditional plans. The Life Insurance Corporation (LIC) of India benefits the most from the high commissions on traditional plans. The high commissions on offer on these non-transparent plans, help in collecting a lot of money from people all across the country.

Also, it is worth remembering that LIC comes to the rescue of the Indian government regularly. On August 24, 2015, the government was investing around 10% of its holding in Indian Oil Corporation (IOC). On that day, the stock market fell big time. LIC came to the rescue of the government and picked up around 86% of the shares that the government was selling in IOC.

In this scenario, the government and the IRDA limiting the commission that LIC is allowed to pay to its agents, is highly unlikely.

The column originally appeared on Firstpost on Sep 9, 2015

(Vivek Kaul is the author of the Easy Money trilogy. He tweets @kaul_vivek)


Of LIC and the great Indian disinvestment farce

I should have written this column around a week back, nevertheless it’s still not too late to make the point that I want to make.

On August 24, 2015, the BSE Sensex fell by 1624.51 points or a whopping 5.94% to close at 25,741.56 points. This was the biggest drop that India’s premier stock market index had seen since January 7, 2009.

In all the hungama that followed around the Sensex fall another important story got buried. On the same day, the government was trying to sell 24.28 crore shares or 10% stake in the Indian Oil Corporation (IOC) at Rs 387 per share. The government was hoping to raise around Rs 9,400 crore through this disinvestment.

In the budget presented in February earlier this year, the government had set a disinvestment target of Rs 69,500 crore. Of this amount it hopes to raise Rs 28,500 crore through what it calls strategic disinvestment.

On a day when stock markets all over the world fell it was hardly surprising that there were almost no takers for the government’s share sale. The retail portion of the IOC disinvestment issue was subscribed only 0.18 times i.e. only about one-fifth of the shares that were offer.

The fact that the government had no idea of what was about to hit it, can be made out by the disinvestment secretary Aradhana Johri’s comment on August 21, 2015. She said that the stock market had an “excellent appetite” for the IOC offering. As it turned out, her definition of the stock market included only one investor. In the end, the Modi government, like the governments before it, had to call on the Life Insurance Corporation (LIC) of India to come to its rescue.
LIC picked up 20.87 crore shares or 8.59 per cent of IOC and thus bailed out the government. This would have cost LIC around Rs 8,087 crore. There are multiple points that need to be made here.

The government treats LIC as a sovereign wealth fund, which keeps coming to its rescue whenever required. But the money LIC has and manages is not the government’s money. The LIC manages the hard earned savings of the people of India and given that these savings need to be treated with a little more respect.

A filing made on the Bombay Stock Exchange website points out that LIC now owns 11.11% of IOC. SEBI rules do not allow mutual funds to own more than 10% of a company. This is to prevent concentration of risk on the overall investment portfolio. But this does not apply to LIC, given that it is an insurance company.
The question is why is the government allowing this concentration of risk in LIC’s investment portfolio to happen? Why are rules different for the private sector and the public sector? Ultimately like mutual funds, LIC is also basically managing money.

The LIC chairman SK Roy has said in the past that “every investment decision happens after due diligence.” What due diligence leads to an investment corporation (which LIC basically is) to buy a share at Rs 387, when the weighted average price of the stock during the course of the day was around Rs 380?

Roy told The Indian Express in an interview in July 2015: “If you see the OFS (offer for sale) of last 14 months, we have never got more than 50 per cent of the offered amount…So the question of bailing out doesn’t arise. A bailout happens when the entire 100 per cent is taken by us. There’s no data to support this.”

In the IOC disinvestment last week, LIC bought 20.87 crore shares of the 24.28 crore shares that were on sale. This amounts to 86% of the total shares that were being sold by the government. This makes it clear that the LIC bailed out the government and what Roy had claimed in July is no longer true. Further, Roy’s claim about following “due diligence” doesn’t really hold. Like previous LIC chairmen he also followed instructions from Delhi though he can’t admit to doing the same.

Also, if IOC is a good buy, why was LIC bringing down its stake in the company since June? As on June 30, 2015, LIC’s holding in IOC was 2.83%. Before the August 24 purchase, this holding was down to 2.52%. Hence, over a period of nearly seven weeks, LIC had sold a substantial stake in the company.

Also, as an LIC official told Business Standard on the condition of anonymity: “LIC is a long-term investor and we looked at the offer quality and subscribed for it. A call was made to us since as there was a crisis-like situation with the markets. We have not set aside any funds for disinvestment. We take a call based on the merit of every offer.” So, if IOC was such a good buy why had not LIC set aside any money for it?

Further, any ‘real’ disinvestment happens when shares are bought by the private sector (be it retail or institutional investors). But what seems to be happening with the Modi government’s disinvestment programme is that the LIC is taking over from the government. One arm of the government is being replaced by another government. This is nothing but a farce.

In fact, the disinvestment secretary Ardhana Johri made a good joke when she told PTI that the sale was “highly successful given the market conditions” and “with this the government has managed the best-ever first half disinvestment collections in seven years.” The government has managed to raise around Rs

Hence, on this front the Modi government has been no different from the earlier Manmohan Singh government, which also used to get LIC to rescue its disinvestment share sales.

Also, what is the point of going through this elaborate farce anyway? If shares are to be bought by LIC, why does the insurance behemoth have to buy shares from the market? Why can’t the government allocate shares to LIC directly and at a discount, so that LIC investors can also gain, given that it is their hard earned money that is being put to such risk?

To conclude, the government also plans to raise Rs 28,500 crore through strategic disinvestment. This is essentially a euphemism for the government selling its stakes in loss making companies. Further, the Cabinet has already approved sales of shares of such companies’ worth around Rs 50,000 crore.

I sincerely hope that if the stock market investors do not buy these shares, LIC is not forced to take them on.

The column was originally published on The Daily Reckoning on Sep 1, 2015