Government-backed Life Insurance Corporation of India’s (LIC) embedded value has been placed at over $66.82bn (INR5trn), Reuters reported citing an official overseeing the insurer’s IPO.

“I would say the embedded value could be more than INR5trn and the enterprise value will be multiples of that,”, department of divestment secretary Tuhin Kanta Pandey told the news agency in an interview.

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The embedded value will help determine the market value of LIC, which is expected to be around four times INR5trn, as per Indian media reports.

LIC is a key player in the Indian life insurance space and the government is looking to raise about $12bn through the IPO, which will help close the deficit gap.

The government plans to submit the draft IPO prospectus to investors as early as next week, Pandey said.

In the budget presented earlier this week, the government slashed its divestment target to $10.43bn in the financial year ending in March.

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It can meet its divestment target by selling a 5% interest in LIC but is open to diluting as much as 10% stake, sources have said.

Without disclosing the size of the IPO, Pandey said that LIC’s listing will be a major market event, which could help bring in investors to buy a stake in other PSUs.

LIC does not plan to issue fresh shares in the primary market and the entire issuance is likely to be sold in the secondary market, Pandey added. The government will continue to be the majority stakeholder in the life insurer. By law, the government cannot lower its stake below 51%, he said.