General Insurance Corporation of India’s (GIC Re) proposed initial public offering, through which the firm aims to mop up about ₹11,500 crore, is expected to hit the markets next week. The IPO will be the biggest since Coal India raised ₹15,200 crore in October 2010.
Axis Capital, HSBC Securities and Capital Market, Citigroup Global Markets, Deutsche Equities India are among the bankers to the issue.
GIC Re, which filed its offer document with market regulator Securities and Exchange Board of India in August, plans to issue 17.2 million fresh equity shares and an offer for sale of 107.5 million shares, or 14.2% stake, by the government. The divestment could fetch the government close to ₹10,000 crore. The government has so far managed to raised ₹15,000 crore through disinvestments in 2017-18, though its target for the year is ₹72,500 crore..
‘Four more in line’
Four other state-run general insurance companies — New India Assurance, National Insurance, Oriental Insurance and United India Insurance — are also planning to raise funds from the capital market. New India has already received SEBI’s approval for its IPO and has appointed merchant bankers.
The GIC IPO comes close on the heels of two successful offerings — ICICI Lombard General raising ₹5,800 crore and SBI Life Insurance, which was listed on the exchanges on Tuesday, raising ₹8,400 crore.
Shares of SBI Life gained a marginal 2% over its issue price of ₹700.
SBI Life’s issue was subscribed almost 3.6 times with bids received for more than 31 crore shares against 8.82 crore on offer. ICICI Lombard was subscribed close to three times with bids received for more than 18 crore shares against 6.17 crore on offer. Currently, shares of ICICI Lombard are trading at ₹685.50, higher than its issue price of ₹661.
