With the IPO bug biting companies, it looks like domestic institutional investors such as mutual funds and insurance companies are not far behind.
In 2017, five insurance companies and a fund house have filed offer documents with SEBI to come out with their IPOs.
Recently, Reliance Nippon Life Asset Management has filed draft offer document with SEBI for its IPO. The fund house will be the second asset management company in India to go public. Shriram Mutual Fund was the first AMC to launch its IPO way back in 1995.
Similarly, five insurance companies – HDFC Standard Life, SBI Life, ICICI Lombard, New India Assurance and GIC Re have filed draft offer documents with SEBI.
While HDFC Standard Life and SBI Life deal with life insurance business, ICICI Lombard and New India Assurance have non-life businesses. GIC Re is into re-insurance business.
HDFC Standard Life Insurance will dilute its 15% stake by issuing close to 30 crore shares. Earlier, Nilesh Sathe, Member (Life), IRDAI had told Cafemutual that the final call on HDFC Life’s IPO issue will be taken in the upcoming board meeting scheduled for August 28, 2017. According to market reports, HDFC Life may raise Rs.7,500 crore through its IPO.
Last month, private general insurer ICICI Lombard General Insurance and SBI Life Insurance had filed offer document with SEBI. ICICI Lombard’s offer includes up to 8.6 crore equity shares or 19% stake while SBI Life Insurance will offer 12 crore shares or 12% stake.
Through New India Assurance's IPO, the government plans to sell 9.6 crore shares and the company will issue 2.4 crore shares to raise capital. According to media reports, the public sector insurers are expected to hit the market in the current financial year and the offer is likely to fetch around Rs.6,000-Rs.7,000 crore.
Similarly, the government plans to dilute 14% stake by issuing 10.70 crore shares in GIC Re IPO.It plans to raise around Rs.10,000-Rs.12,000 crore from the IPO.
Market experts say that these companies want to take advantage of the on-going market rally as investors are looking for various investment opportunities.
