(Image source from: LIC buys 86% shares of Indian Oil on offer by government})

State-owned Life Insurance Corporation (LIC) of India bought 86% Indian Oil shares rescuing $1.4 billion (Rs 9,100 crore) government sale following India’s biggest tumble in over six years. The sale was destabilized by the sharpest fall in the Indian stock market, since January 2009.

Being India's biggest investor, LIC has in the past bought state banks and government mining firms. It was a major support to the sale of Coal India shares and the sale of shares in Steel Authority of India (SAIL) in Janyary and last year, respectively. At times, these investments turned fruitful to LIC. Its investment in January 2014, stock in the State Bank of India is up 60%.

IDBI Federal Life Insurance Co. chief investment officer Aneesh Srivastava said it would be difficult for India to meet its divestment target of $10.5 billion, but as it has already carried out four sales could help. "The way the government has structured the sales so far they are on target, unless the market conditions really deteriorate. In that case even LIC can't save them," Srivastava said.

As Indian Government announced move on Indian Oil on Friday, it had no option but to go ahead with sale of 10% stake in the refiner and fuel retailer on Monday.

Aradhana Johri, divestment secretary, said after the sale that, "We have to rethink our strategy.”

"Basically, we have to look at which are the stocks we need to put on the market and where the appetite in the market lies," he added.

-Sumana