The Life Insurance Corporation of India (LIC) has been granted an extension till 2032 to comply with the 25% public shareholding rule, according to the Securities and Exchange Board of India (SEBI). The deadline for LIC to achieve the minimum public shareholding of 25% was initially set for 2020. However, considering LIC’s complex structure and its role as a market investor and regulator, the SEBI has granted the extension to allow LIC to gradually pare down its stake in various companies and meet the requirements by 2032. LIC is the largest insurance company in India and its compliance with the public shareholding rule is expected to increase the float in the market, providing more liquidity and boosting investor sentiment. The SEBI’s decision to grant LIC an extended deadline has been welcomed by market participants, as it allows for a more gradual transition and avoids any potential disruption to the market. The public shareholding rule was introduced to promote transparency and optimize corporate governance in listed companies. By having a minimum public shareholding in companies, it ensures wider ownership and reduces the concentration of control in the hands of a few entities. LIC currently holds significant stakes in several public listed companies and divesting its holdings in a systematic manner will require careful planning and coordination by the insurer. The extension granted by the SEBI will provide LIC with the necessary time to execute its divestment plans and comply with the regulations. The announcement of the deadline extension has had a positive impact on LIC’s stock performance, with the share price witnessing an increase. This reflects the market’s confidence in LIC’s ability to fulfill the regulatory requirements within the extended timeframe. Overall, the extension granted to LIC to achieve the minimum public shareholding of 25% by 2032 is a positive development that aligns with the objective of promoting greater transparency and enhancing investor confidence in the Indian stock market.