IndiaFirst Life Insurance (IFLI) has submitted its draft prospectus for an initial public offering (IPO) to the market regulator, the Securities and Exchange Board of India (SEBI), raising funds totaling INR 20 billion (US$ 242.6 million). could raise up to INR 25 billion.
The proposed IPO consists of a new issue of shares worth up to INR 5 billion and an Offer to Sell (OFS) of up to 141,299,422 shares. The latter block of shares comprises up to 89,015,734 shares owned by the insurance company’s promoter, the Bank of Baroda (BoB); 39,227,273 shares held by Carmel Point Investments India; and 13,056,415 shares owned by Union Bank of India.
BoB, India’s third largest public sector bank, holds a 65% stake in the company, followed by Carmel Point Investments India, a subsidiary of Warburg Pincus, (26%) and Union Bank of India (9%).
Proceeds from the IPO from the issuance of new shares will be used to strengthen the insurer’s capital base to support solvency levels.
The shares are to be listed on the BSE and the NSE.
IFLI recorded the highest five-year growth in individually rated premium (IRP) on new business among government-backed life insurers at a CAGR of 27.3% between FY2017 (fiscal year ended March 31, 2017) and FY22. The company’s embedded value increased at a CAGR of 10.94% from INR 16,812 million in FY21 to INR 18,650.1 million in FY22. The company recorded a net loss of INR 2,816.2 million in FY22 during it recorded a net profit of INR 301.9 million in FY21.
IFLI will be the fourth private life insurer to go public and the fifth overall life insurer to list its shares. The other four are ICICI Prudential Life Insurance, SBI Life Insurance, HDFC Life Insurance and Life Insurance Corporation of India.
Comments are closed.