Why are some of the analysts insisting that LIC pay out a huge dividend?

LIC listed on the stock exchanges on Tuesday nearly 8% lower. The stock made several attempts at bouncing back but eventually closed in the red at Rs873. The closing was very close to the low point of the day. In fact, the closing of the LIC stock was not only below the issue price, but also below the discounted IPO price. The applicable price to retail shareholders is (Rs904) and policyholders is (Rs889).

Due to the sharp losses post listing, there has been a notional loss of around Rs.50,000 crore for the investors and traders. Hence, now a number of traders and analysts are already demanding a bumper dividend from LIC so that it is able to offset the price impact. The general emergent view is that if LIC tries and maintains a dividend yield of somewhere around 3-4%, that can act as a support base for the LIC price.