SBI Life Insurance IPO likely in 2017/18


SBI Life Insurance IPO may be launched in the next financial year and the insurance company may sell up to 10% stake through the public offer, said the company’s managing director and CEO Arijit Basu.

“Finally whether an IPO will happen or when it will happen we have not still decided. But there is a possibility that it may happen in the coming financial year that is 2017-18. So in IPO, when you go to market for the first time you offer 10%,” said Basu in a press conference. However, the composition of this 10% is still undecided. Basu indicated both partners may decide to offer 5% each through the IPO while SBI alone may go for offloading its 10% stake.

SBI Life Insurance is a joint venture between State Bank of India (SBI) and BNP Paribas Cardif. Following a transaction last month, the former’s equity stake came down from 74% to just over 70%. SBI recently sold 3.9% stake in the JV to Singapore sovereign fund Temasek and private equity (PE) house KKR for INR1,794 crore (INR17.9 billion). The transaction valued SBI Life Insurance at INR46,000 crore. In the past, SBI was reported to be interested in selling more and offered to sell 10% to JV partner.

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He said SBI Life Insurance grew at 39% in individual new premium till December in comparison to the industry’s growth rates at 20 to 22%. Basu mentioned that SBI Life Insurance’s market share improved to 21% as on December 2016, up from 18% in the previous year.

SBI Life Insurance IPO to follow ICICI Prudential Life’s lead

Insurance companies are in limelight regarding their IPO plans and ICICI Prudential Life IPO last September may have set an example for more insurance listings. Although the company disappointed investors with a discounted listing, stock price has recovered subsequently. Apart from ICICI Prudential Life, HDFC Life was also among the front runners for exchange listing but its IPO plans have been cancelled now after it decided to merge with Analjit Singh’s Max Life Insurance and Max Financial Services. However, Canara HSBC Oriental Bank of Commerce Life Insurance, Aviva India Life Insurance and Max Bupa Health Insurance are known to be preparing for their public listings. In addition, the central government has indicated it will list five general insurance companies – New India Assurance Company, United India Insurance, Oriental Insurance Company, National Insurance Company, and reinsurer General Insurance Corporation of India (GIC).


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