Regulator Irdai has asked the life insurance behemoth LIC to prepare a roadmap to pare its stake to 15 per cent in firms where it breaches this ceiling, but has stopped short of setting a time-frame for the same.

As of end March, LIC owned more than 15 percent in index majors like ITC (16.32 percent) and L&T (16 percent), both part of the Suuti (specified undertaking of the Unit Trust of India) stakes that government owns through LIC, and state- owned Corporation Bank in which it owns 18.91 per cent.

"We have advised LIC to reduce its stake in those companies where it owns more than 15 per cent and submit a roadmap for the same as the regulatory norms restrict insurers to own over 15 percent in any firm," a senior Irdai official told PTI requesting not to be named.

The official was quick to add that the regulator has not given any time-frame as yet for the same. Also, the official said this "advisory will not be applicable in case of Corporation Bank as LIC has taken a special permission from the government for the same".

However, this advisory does not apply to LIC's holding in Corporation Bank as it had already taken a special permission from the government to increase its stake last year.

LIC also owns around 15 per cent in Axis Bank (14.49 percent, again part of the Suuti holdings), Uco Bank (14.5 per cent), and IDBI Bank (13.87 percent) as of end March.

Earlier this year, when the government divested 2 percent in ITC which was held through Suuti, LIC picked up this 2 percent through a block deal for Rs 6,690 crore, thus increasing its holdings to 16.32 percent.

The advisory comes amidst the ongoing PIL in the Bombay High Court against LIC's stake in the tobacco major by a clutch of individuals including the managing trustee of the Tata Trusts in his individual capacity.

The High Court had on Thursday last sent notices to ministries of finance, agriculture and industry, as also the markets regulator Sebi and LIC making them party to the public interest litigation (PIL), that seeks some direction against the government and LIC and other insurance holding shares in the cigarette maker.

The court directed insurance companies, regulator Irdai, and other parties to file their responses within six weeks.

The government, through five state-run insurance firms and through Suuti, owns a 32 per cent stake in ITC. Its holding in the firm is worth Rs 1.07 lakh crore, of which Rs 76,505 crore is held by the state-run insurers.

The petition was filed by Tata Trusts' R Venkataramanan, Sumitra Pednekar whose husband Satish Pednekar who a former minister in Maharashtra, died of throat cancer; Pankaj Chaturvedi, head and neck cancer specialist at Tata Memorial Hospital; Abhay Bang; Ashish Deshmukh, an MLA in Maharashtra; Prakash Gupta and Lakshman Sethuraman, who heads cancer infrastructure projects at Tata Trusts.

The petition argues that it doesn't make sense for government to directly or indirectly hold stake in ITC or for that matter other tobacco firms.