Niva Bupa Health Insurance Files for Rs 3,000 Crore IPO, Aims to Strengthen Solvency

Niva Bupa Health Insurance Company Ltd has filed for an IPO worth Rs 3,000 crore with SEBI. The offering includes Rs 800 crore in new equity and Rs 2,200 crore from existing shareholders. Proceeds will strengthen the company's capital base and support corporate purposes.

Niva Bupa Health Insurance Company Ltd, once Max Bupa Health Insurance, has submitted its initial paperwork to securities regulator SEBI for raising Rs 3,000 crore through an Initial Public Offering (IPO).

The IPO consists of a new equity issue valued at Rs 800 crore and an offer for sale (OFS) of up to Rs 2,200 crore from both a promoter and an investor shareholder, as detailed in the Draft Red Herring Prospectus (DRHP).

Specifically, investor Fettle Tone LLP plans to sell shares worth Rs 1,880 crore while Bupa Singapore Holdings Pte Ltd, a promoter entity, will offload shares amounting to Rs 320 crore. The insurance firm is majorly owned by Bupa, an international healthcare company headquartered in the UK. Currently, Bupa Singapore Holdings holds a 62.27% stake and Fettle Tone LLP 27.86%.

According to the draft, the company might issue securities worth up to Rs 160 crore as part of a 'pre-IPO placement'. Should this go through, the size of the new equity issue will be proportionally reduced. The firm plans to channel net proceeds of Rs 625 crore from the fresh issuance into bolstering its capital base to improve solvency levels, with some funds allocated for general corporate purposes.

This move makes Niva Bupa the second standalone health insurer to seek an IPO after Star Health & Allied Insurance Company. In fiscal 2024, Niva Bupa reported a Gross Direct Written Premium (GDPI) of Rs 5,499.43 crore, showing a significant rise from previous figures. The firm operates 210 physical branches across 22 states and 4 union territories in India.

ICICI Securities, Morgan Stanley India Company, Kotak Mahindra Capital Company, Axis Capital, HDFC Bank, and Motilal Oswal Investment Advisors are the book-running lead managers for the IPO, aiming to list shares on both the BSE and NSE.

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