SBI Life Insurance will decide on going for Initial Public Offering (IPO) in the first quarter of next fiscal, according to its managing director and chief executive officer Arijit Basu.
Mr. Basu said there was a “strong possibility” of the State Bank of India and BNP Paribas Cardif joint venture coming out with an IPO in 2017-18, he said. The details, however, were yet to be worked out.
While it “can purely be divestment,” there is a possibility of SBI alone shedding a part of its stake or BNP Paribas Cardif doing the same. Last month, when SBI sold 3.9% in the joint venture to Singapore sovereign fund Temasek and PE major KKR for ₹1,794 crore, the company was valued at ₹46,000 crore. The stake sale brought down SBI’s holding to a little over 70% and according to reports, the country’s leading bank had also offered to sell 10% to its French partner in the insurance company.
A decision on the possibility of raising the paid-up capital of the private life insurer had not been taken, Mr.Basu said adding the company had not raised capital since 2008.
Hoping the valuation to be better, he said SBI Life was experiencing “a high growth phase” and of the targeted ₹9,500 crore, total new business premium in current fiscal crossed the ₹8,000 crore mark. The individual new business premium rose39% till December as against an industry average of 20-22%. The market share of SBI Life increased from 18% in December 2015 to 21% in December 2016.
On new products, Mr.Basu said earlier this month, the company added Smart Bachat, a traditional product, to its basket of over 25 products and was looking to focus on niche products in the next fiscal. In 2016-17, it had introduced four products so far, he said.
