Reliance General Insurance has received an in-principle approval from the insurance industry regulator for its proposed IPO. The company said in a media release that the listing is expected to be complete in FY18, subject to necessary approvals.
Earlier in August, Reliance Capital, the Indian diversified financial services holding company promoted by Reliance Group, has filed the draft IPO documents with IRDA for listing its general insurance business- Reliance General Insurance. Reliance General Insurance is looking to sell 10% through initial public offering in this financial year. It plans to sell 25% in the next three years.
In June this year, Rakesh Jain, the MD and CEO of Reliance General Insurance said, “The General Insurance industry is slated to grow with the economy where affluence led consumption will act as its primary growth driver.” The move is primarily aimed at unlocking value for all the stakeholders. Rakesh Jain believes that it provides a good opportunity for retail investors.
“The listing will enable retail investors to participate in this high growth and new wealth creation opportunity,” he pointed out. The board of Reliance General Insurance approved the plan to list independently on the exchanges, making it the fourth general insurance company to have announced it’s intentions to list. Reliance General Insurance has more than more than 100 branches and commands a market share of more than 3% in terms of gross premium for the year ended March 31, 2017.
According to the company’s press release, it provides a wide range of general insurance products like fire, motor, health, home, crop, travel etc. The company’s gross direct premium stood at Rs 3,935 crore in the year ended 31st March, 2017. Further, Reliance General Insurance stated that the Profit Before Tax stood at Rs 130 crore, up 32%, while the investment book stood at Rs 6,724 crore, up 25% for the year ending 31st March, 2017.
Post listing, the company will be keen to expand inorganically. In fact, Reliance General has been for a strategic partner for over last four to five years. Elaborating on the company’s plan after listing on the exchanges, Rakesh Jain said recently, “We are open to strategic partnerships even post listing.”