The initial public offering of Niva Bupa Health Insurance Company is entering day 2. The IPO that comes out with a price band of ₹70-74 a share closes on November 11 (Monday). The IPO has so far been subscribed 0.65 time.
The IPO is a mix of fresh issue of up to ₹800 crore and an offer-of-sale up to ₹1,400 crore by Bupa Singapore Holdings and Fettle Tone LLP. Currently, Bupa Singapore Holdings owns 62.19 per cent stake and Fettle Tone 26.8 per cent stake in the insurance firm. Investors can bid for a minimum of 200 equity shares and in multiples of 200 equity shares thereafter.
The offer is being made through the book-building process, wherein not less than 75 per cent of the net offer shall be available for allocation on a proportionate basis to qualified institutional buyers, not more than 15 per cent for allocation to non-institutional investors. , and not more than 10 per cent for retail investors. The retail Investors’ portion was subscribed 0.71 times, while that of QIBs and NIIs 0.79 and 0.33 times, respectively.
Niva Bupa Health Insurance Company has garnered approximately ₹990 crore from anchor investors by allocating 13,37,83,783 shares at ₹74 a share on Wednesday, as part of the IPO process. Foreign and domestic institutions who participated in the anchor included Amansha Holdings, Zulia Investments, A91 Emerging Fund II LLP, Nippon Life, Tata Balance Advantage Fund, Axis Mutual Fund, Morgan Stanley Investment Fund amongst others. Six domestic mutual funds were allocated shares out of total of 32 anchor investors.
The proceeds from its fresh issuance will be utilized to the extent of ₹800 crore for augmentation of capital base to maintain and strengthen solvency levels; and general corporate purposes.
The company has reduced the issue size as it was earlier planning to launch ₹3,000-crore IPO.
This will be the second standalone health insurer looking to float an IPO, after Star Health & Allied Insurance Company.
Niva Bupa is one of the leading standalone retail health insurers (SAHI) in India, with a Gross Direct Written Premium (GDPI) of ₹5,494 crore in fiscal 2024. The insurance firm’s profit surged to ₹81.85 crore in fiscal 2024 from ₹12.54 crore. in fiscal 2023.
ICICI Securities Limited, Morgan Stanley India Company Limited, Kotak Mahindra Capital Company Limited, Axis Capital Limited, HDFC Bank Limited and Motilal Oswal Investment Advisors Limited are the lead book-running managers and KFin Technologies Limited is the registrar of the offer.