India's IPO frenzy is all set to hot up as Policybazaar, India’s largest online insurance aggregator, has filed papers with the market regulator Sebi to raise Rs 6,017.5 crore. With the mega IPO, Policybazaar is the latest Indian startup, after Zomato, Paytm and MobiKwik, looking to list on stock exchanges.
The IPO comprises a fresh issue of Rs 3,750 crore worth of equity shares and an offer for sale (OFS) of Rs 2,267.50 crore by existing shareholders, according to draft red herring prospectus (DRHP). As part of the OFS, SVF Python II (Cayman) will sell shares worth Rs 1,875 crore, Yashish Dahiya will sell shares worth Rs 250 crore and some other selling shareholders will also offer shares.
The firm may consider raising around Rs 750 crore by way of a private placement of equity shares ahead of the IPO.
Proceeds of the fresh issue will be used towards enhancing visibility and awareness of the company's brands to look for new opportunities to expand growth initiatives to increase the consumer base including offline presence. Also, the proceeds from the IPO will be used for funding strategic investments and acquisitions, expanding presence outside India and general corporate purpose.
Kotak Mahindra Capital Company,Morgan Stanley India Company, Citigroup Global Markets India, ICICI Securities, HDFC Bank Ltd, IIFL Securities and Jefferies India are the book running lead managers to the issue.
Backed by a host of marquee investors like Softbank, Temasek, Info Edge, Tiger Global and Premji Invest, listing plans come on the back of a sharp spike in the demand for online health and life insurance products post the outbreak of Covid-19. It offers products in segments ranging from life insurance (it claims to account for 25 per cent of India’s life cover), investment plans, health insurance, motor insurance, general insurance, travel insurance and others. According to its website, it hit 10 million unique customers in FY 19, sells 4 lakh insurance policies every month and has 40 plus insurers on its platform.
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“India’s life insurance market is expected to grow at 18.8 per cent p.a. to reach Rs 31.9 trillion (US$ 425 billion) in FY2030, driven by favorable macro indicators, rising awareness towards financial products and services, digitization and simplification of products and processes, online channels for distributions, innovations and customizations in products and favorable government policies and regulatory push,” the startup said in the papers.
While Zomato had a stellar debut on the stock exchanges last month, fintech players MobiKwik and Paytm have both filed for their initial public offerings in recent weeks.