The move is primarily aimed at unlocking value for all the stakeholders.
Reliance Capital, the Indian diversified financial services holding company promoted by Reliance Group, has filed the draft IPO documents with IRDA, the insurance industry regulator for listing its general insurance business — Reliance General Insurance, said CNBC TV18 citing unidentified sources. Reliance General Insurance is a 100% subsidiary of Reliance Capital. 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.
The insurance industry has shown great potential in the last few years, clocking a year on year growth of 16-18%. Last year, in grew by 32% last year, on the back of contributions of crop insurance which has emerged as a significant segment for insurers. The stellar growth achieved by the industry last year propelled it to reach 1.27 lakh crore. Reliance General reported 40% growth in gross written premium to Rs 4,007 crore as on March 31 2017. It has networth of Rs 1257 crore. The Company has a well diversified distribution network through collaboration via partnerships with banks including IndusInd Bank, Catholic Syrian Bank, Andhra Bank and Bank of India.
The company had reported a 40% growth in gross written premium to Rs 4,007 crore as on March 31 2017. It has net worth of Rs 1257 crore. The investment book registered a 25% growth and stood at Rs.6,724 crore for the year ending 31st March, 2017. The profit before tax stood at Rs 130 crore.
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, “We are open to strategic partnerships even post listing.”