Liberty Videocon to seek capital infusion from promoters

Written by PTI | Mumbai | Updated: Dec 8 2013, 17:33pm hrs
Private player Liberty Videocon General Insurance is looking at more capital infusion from the promoters to remain "over-capitalised" so as to better capture emerging growth opportunities, a top company official has said.

As a new entrant, its financial muscle will also help the company convince intermediaries and clients about its capacity to participate in underwriting higher risks and settle claims.

"We have started with a capital of Rs 350 crore out of which around 65 crore will be expended in the first year of operations. With our present capital, we are comfortable for next two years.

"But, despite that we will continue to look for more capital," chief executive Roopam Asthana told PTI.

He said: "One big reason for this is that we want to give confidence to our intermediaries that we are sufficiently capitalised to meet the claims when they arise."

Asthana also said higher capital availability will enable it to clock higher growth.

"We want to make sure that at all point of time, we are little over-capitalised to take advantage of market turning more positive than what it is right now... We will be able to go and chase that growth...," Asthana said, adding that higher capital will also enable the general insurer to earn more interest income.

He, however, declined to put a number to the capital that the company will be seeking from the promoters, saying it will be fixed by the end of this fiscal.

Liberty Videocon, a joint venture between Videocon Industries and Liberty Holdings, aims to break even in the sixth year of its operations.