New India Assurance IPO likely to hit capital market by Dec

Gearing up for the firstever initial public offering (IPO) by a PSU insurer, New India Assurance will soon be filing preliminary papers with the Securities and Exchange Board of India (Sebi) so that it can hit the market by December. New India Assurance is the largest among the four PSU general insurers that are owned by the government.

“We are hoping that the IPO process gets completed by the end of the calender year if market conditions are favourable,” New India Assurance chairman and MD G Srinivasan said.

The company is in the process of filing the draft red herring prospectus (DRHP) for the proposed issue. The DRHP should be filed soon, Srinivasan said, without giving a timeline.

The authorised share capital of the company stood at ₹300 crore and the paid-up share capital at ₹200 crore as of March 31, 2016. The government holds 100% stake in the company.

New India Assurance reported a net profit of ₹1,008 crore in 2016-17, up 22% over the previous year, driven by investment income, which whittled down the high underwriting losses. The insurer, with a 16% market share, had a domestic premium income of ₹19,115 crore, a 27.17% growth from ₹15,115 crore a year before.

Headquartered in Mumbai, New India Assurance is the only Indian entity to have a trading desk at Lloyd’s of London, the provider of specialist insurance services.