New India Assurance set to hit markets in Dec, National Insurance too gets IPO-ready

By: | Published: July 20, 2017 3:17 AM

New India Assurance, the largest general insurer in the country, is all set to hit the markets in December this year, while another state-run insurer— National Insurance — has started the process for its initial public offering (IPO).

New India Assurance, National Insurance, IPOThe net worth including fair value of investments increased to Rs 34,716 crore in the last financial year as against Rs 28,895 crore in 2015-16.

New India Assurance, the largest general insurer in the country, is all set to hit the markets in December this year, while another state-run insurer— National Insurance — has started the process for its initial public offering (IPO).

“We expect the final approval from the government in the next few days, after which we will file our draft red herring prospectus (DRHP). We expect to launch our IPO by December this year. Although the final decision on stake sale and valuation have not been taken yet, it could be around 10-15%,” a senior official from New India Assurance said on condition of anonymity.

The net worth including fair value of investments increased to Rs 34,716 crore in the last financial year as against Rs 28,895 crore in 2015-16. Senior officials in the insurance industry said that if the government decides to dilute 10% of its stake in the company, it can raise around Rs 3,500 crore from the IPO.

In mid-January this year, the Cabinet Committee on Economic Affairs had approved listing of five state-owned general insurance companies and reducing the government’s stake in them from 100% to 75%. New India Assurance, Oriental Insurance, National Insurance, United India Insurance and General Insurance Corporation of India, or GIC Re, are the five companies that will list on stock exchanges. GIC Re and New India Assurance are two players which have already appointed merchant bankers to manage their IPOs.

Meanwhile, as part of its IPO process, National Insurance had a meeting with Department of Investment and Public Asset Management (DIPAM). Sanath Kumar, CMD of National Insurance, said, “We have written to the government for the approval of IPO and work is going on. However, as of now, we have not decided what kind of stake sale we would be looking or even the amount which we can raise from IPO.” National Insurance’s net worth as on 2016-17 stood at `9,544 crore as against `8,764 crore in 2015-16. Last week, ICICI Lombard General Insurance had filed DRHP for their IPO, the share sale will see dilution of over 19% stake.

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