ICICI Pru Life’s mega IPO to hit market on Sept 19, price band set at Rs 300-334

NEW DELHI: ICICI Prudential Life Insurance will become India’s first insurer to hit the capital market, when it launches its Rs 6,000 crore initial public offering ( IPO) on September 19.

The insurer plans to sell up to 18.13 crore shares in a price band of Rs 300-334 in what would be the biggest IPO of the calendar year. At the upper band of the price band, the issue will fetch Rs 6,057 crore, while at the lower end, it will garner Rs 5,440 crore.

The offer would comprise 12.63 per cent of total post-paid equity share capital of the company. ICICI Bank will sell its stake in the IPO, but Prudential will not dilute any of its holding.

The retail category will be allotted not less than 5.72 crore shares, while the non-institutional category will get not less than 2.44 crore. The quota limit for qualified institutional buyers (QIB) is set at 8.16 crore shares. Out of this, up to 4.9 crore shares will be allotted to anchor investors and the balance to other QIBs. Bids can be made for a minimum of 44 shares and in multiples of the same thereafter.

Since it will be an offer for sale (OFS), the amount fetched will go to the existing shareholders. The issue will close on September 21.

As of March 31, ICICI Bank held a 67.6 per cent stake in the life insurance firm, while Prudential Corp Holdings (PCHL) held 25.9 per cent.

The total size of the Indian life insurance sector (excluding Sahara Life Insurance) was Rs 3.7 lakh crore on a total premium basis in financial year 2015-16, making it the 10th largest life insurance market in the world and the fifth largest in Asia, Swiss Re said.

The total premium of the Indian life insurance sector grew at a CAGR of approximately 17 per cent between FY01 and FY16. India remains an underpenetrated insurance market with a life insurance penetration of 2.7 per cent in FY15 against 7.3 per cent in South Korea, 3.7 per cent in Thailand and a global average of 3.5 per cent in 2015.