Life Insurance Corporation of India and General Insurance Corporation of India are planning to take exposure in Maruti Udyog from the secondary market once the shares in the automaker drop below Rs 115.

Both the insurers, and State Bank of India, made bids at the initial public offering at the floor price of Rs 115, while the cut-off price was Rs 125.

R N Bharadwaj managing director of LIC, said, "LIC applied for 15 per cent of the offered equity at Rs 115 per share, and would like to take exposure in Maruti only after the shares drop below that price."

LIC officials said Rs 115 was higher than the intrinsic value of a Maruti share and also the cut-off price of Rs 125 was too much higher.

"The price should correct itself once the shares get listed on the exchanges," they added.

P C Ghosh, chairman of GIC, said, "We think the Maruti shares are overpriced, and we would like to take a call only after the share price drops or reaches our internal valuation price in the secondary market."

"We had applied at Rs 115, and the cut-off was fixed at Rs 125. Both these prices are high."

A GIC source said the firm's internal valuation of Maruti shares was around Rs 90 a share.

"Though there could be a surge initially after the share is listed, over the next few months the share price will settle at its fair value," the source added.

The government has decided to allot 40 per cent of the offered 7.94 crore (79.4 million) shares in Maruti to institutional investors and the rest to retail investors.