The Union government on February 13, 2022 filed Draft Red Herring Prospectus (DRHP) for the Life Insurance Corporation of India (LIC) IPO with Securities and Exchange Board of India (SEBI).
- The DRHP has pegged the Indian Embedded Value (IEV) — a measure of future cash flows in life insurance companies, and the key financial gauge for insurers — at around Rs 5.40lakh crore.
What is Draft Red Herring Prospectus (DRHP)?
- A Draft Red Herring Prospectus (DRHP), or offer document, is the preliminary registration document prepared by merchant bankers for prospective IPO-making companies in the case of book building issues.
- The DRHP document includes information about the company’s business operations, promoters, financials, its standing in the industry it deals in and listed or unlisted peers.
- It should also include sections on the current status of the business, as well as any risks involved with investing in this company.
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