Indian PE-backed insurer SBI Life files for IPO
SBI Life, the life insurance subsidiary of the State Bank of India (SBI) whose backers include KKR and Singapore’s Temasek Holdings, has filed for an IPO.
SBI Life’s offer will consist exclusively of shares from existing investors SBI and BNP Paribas, which are offloading up to 80 million and 40 million shares, respectively. The shares to be sold by the investors amount to a 12% stake in SBI Life, according to the prospectus. According to Indian media reports, the offer will launch this week, with the price band set at INR685-700 per share.
Through the listing, SBI Life hopes to enhance the reputation of its brand and provide liquidity to the existing shareholders. The company will not receive any proceeds from the offer and KKR and Temasek, which invested INR18 billion ($266 million) in the company last year, will not exit their stakes.
SBI and BNP Paribas launched SBI Life in 2001 as a joint venture aimed at combining the established brand equity of SBI with the global insurance industry expertise of BNP Paribas. As of July 2017, it had one of India’s largest multi-channel private life insurance distribution networks, with over 95,000 agents handling direct sales and sales through corporate agents, brokers, insurance marketing firms and other intermediaries.
Since 2010 it has led the market in new business premiums – the premium acquired from new policies – each year, accounting for 20% of the private life insurance market for the year ended March 2017. Income from all premiums came to INR210 billion over the same period, up from INR158 billion the year before. Net profit rose from INR36.9 billion to INR44.6 billion.
Fellow Indian insurer ICICI Lombard General Insurance is also reported to be launching its IPO this week, after filing its prospectus in July. The company will sell up to 86 million shares, reportedly for as much as INR661 each, all from existing shareholders. Its PE backers, which include Warburg Pincus, Tamarind Capital and IIFL Asset Management, will not exit their stakes.
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