IPO NEWS: Well-known health insurance company to bring earnings opportunity, plans to raise Rs 3000 crore

Niva Bupa Health Insurance Company Ltd formerly known as Max Bupa Heath Insurance Company Ltd has filed an application with capital market regulator Sebi to raise Rs 3,000 crore through an initial public offering i.e. IPO.

According to the draft red herring prospectus (DRHP), the proposed IPO includes a fresh issue of equity shares worth Rs 800 crore and an offer for sale (OFS) of up to Rs 2,200 crore by promoters and investor shareholders.

Under the OFS, investor Fettle Tone LLP will sell shares worth Rs 1,880 crore and promoter Bupa Singapore Holdings will sell shares worth Rs 320 crore. Niva Bupa is majority owned by Bupa, an international health care company headquartered in the UK.

Bupa Singapore Holdings holds a 62.27 percent stake.

Currently, Bupa Singapore Holdings holds 62.27 per cent stake while Fatal Tone LLP holds 27.86 per cent stake in the insurance company. The company said in its draft papers filed on Saturday that it may consider issuing securities of up to Rs 160 crore as part of a pre-IPO placement. If such placement is completed, the size of the new issue will be reduced.

The company will use the net proceeds of Rs 625 crore from the fresh issue to strengthen its capital base to strengthen its solvency level, besides a portion will be used for general corporate purposes.

Another standalone health insurance company will launch an IPO

This will be the second standalone health insurance company to launch an IPO after Star Health and Allied Insurance Company. Niva Bupa Health Insurance Company is one of the leading Standalone Retail Health Insurers (SAHI) in India with Gross Direct Premiums Written Premium (GDPI) of ₹5,499.43 Crore in FY2024.

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