ICICI Pru Life Insurance shares to be listed on 29 Sep
Lately
the shares of ICICI Prudential Life Company Ltd. (ICICI Pru), hit the
market with its initial public offering (IPO) which is going to be
listed on the stock exchanges on September 29. The company had set
Rs.18.13 crore shares at a price band of Rs. 300-334 per share while the
issue price has been fixed at Rs. 334 per share.
India’s largest private sector insurer had raised Rs 1,635 crore from
anchor investors as they sold 48.96 million at the upper end of the
price band from institutional investors. The upper end of the price band
shows an implied market capitalization of Rs. 47,940 crore for the
company. After the issue, the share of the insurer’s promoters will slip
down to 88.6 per cent from the current 100 percent. The initial public
offering (IPO) of ICICI Prudential Life Insurance today settled with
10.47 times subscription for shares offered to the public.
ICICI Prudential Life Insurance Company is a joint venture between
private sector lender ICICI Bank and British insurance company
Prudential Corporate Holdings. ICICI Bank share price is quoting 0.42
per cent higher at Rs. 261.10 on the NSE on 27th September.
The offer got bids for more than 138 crore shares in 3 days against
nearly 13.24 crore shares on sale. The quota for retail investors
received bids for nearly 8 crore shares, a subscription of 1.39 times.
The reserved portion for non-institutional investors saw bids for over
69 crore shares, a subscription of nearly 28.55 times, whereas the
sector for qualified institutional buyers was subscribed approximately
12 times. The allocated portion for the shareholders of ICICI Bank was
subscribed over 12 times. The float raise around Rs 6,057 crore at the
upper end of the price band of Rs 330-334 per share, turning it to be
the biggest IPO after Coal India that hit the capital markets in 2010 to
raise over Rs 15,000 crore.
The India life insurance sector happens to be the 10th largest life insurance market in the world and the 5th largest
in Asia. There are around 24 life insurance companies in India, which
includes the Life Insurance Corporation of India (LIC), the state-run
entity. The private sector has shown significant growth since 2000 and
it accounted for 51.5 per cent of the life insurance sector, on an RWRP
basis, in financial year 2016. Foreign insurance companies can hold up
to 49 per cent stake in Indian insurance firms, up from the earlier
limit of 26 per cent.
The insurance penetration levels are low in India as compared to its
peers in the rest of Asia. India is still an under-penetrated insurance
market with a life insurance penetration of 2.7 per cent in financial
year 2015, as compared to 3.7 per cent in Thailand, 7.3 per cent in
South Korea and a worldwide average of 3.5 per cent in 2015. At US$43 in
financial year 2015, the insurance density in India also stayed very
low as compared to other developed and emerging market economies.
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