The Life Insurance Corporation of India (LIC) filed the draft red herring prospectus (DRHP) with market regulator Securities and Exchange Board of India (SEBI) on Sunday for its proposed initial public offering (IPO). As per the DRHP, LIC's offer is entirely an offer for sale (OFS) of 316,249,885 shares by the shareholder, meaning the government would sell 5 percent of its total stake.

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The much awaited IPO of LIC, India's biggest share sale of all time, comes at a time when a majority of initial share sales have enjoyed a robust response from investors. Its listing is expected by March.

LIC is offering its policyholders the opportunity to be a part of the big public issue and is likely to offer a discount of 5 percent to them. The company is also promoting the offer through televised and newspaper advertisements.

>>Also Read | LIC IPO: Policyholders with lapsed policies can still apply for shares

According to analysts, retail investors, including first-timers, are likely to participate in the LIC IPO in large numbers.

To participate in the IPO, it is mandatory for the bidder to have a demat account. A demat account or dematerialisation account is a medium through which the individual holds stock market shares and other securities. The LIC has asked its policyholders, those who do not have a demat account, to get one at their own cost.

Following are the steps to open a demat account:

The individual needs to choose a depository participant (DP), which could be an authorised bank, broker or financial institution, to open the demat account. Before choosing the DP, the individual should check the brokerage charges, annual fees and leverages provided.

The individual then needs to visit the official website of the broker and initiate the demat account opening procedure.

The individual will have to click on ‘open Demat Account’ tab and assign a nominee to the account.

Relevant information required in the form needs to be provided and the KYC (Know Your Customer) process has to be completed before proceeding.

The broker will ask for scanned copies of the individual’s documents such as identity proof, address proof, bank account statement and income proof.

After submitting and verifying the details, the individual will have to pay the brokerage fees for trading.

It is mandatory for the brokerage to conduct an in-person verification, either online or in the office.

After verification, the request to open a demat account is approved.

The individual will receive a unique 16-digit beneficial owner identification number, which is also known as the demat account number. The number has to be used to access the demat account online.

After opening the account, the individual can log in and start online trading.

>>Also Read | How to participate in LIC IPO: All you need to know