Niva Bupa Health Insurance submits draft documents to Sebi for a Rs 3,000 crore IPO
Niva Bupa Health Insurance, formerly known as Max Bupa Life Insurance, has submitted its draft red herring prospectus (DRHP) to the Securities and Exchange Board of India (Sebi) to initiate its initial public offering (IPO). The company aims to raise Rs 3,000 crore from investors through this IPO. According to the draft documents, Niva Bupa plans to raise Rs 800 crore through fresh shares, with the remaining Rs 2,200 crore to be raised via an offer-for-sale (OFS) from its promoter Bupa Singapore Holdings and existing shareholder Fettle Tone LLP.
In consultation with the book-running lead manager, the company may consider issuing specified securities worth up to Rs 160 crore as a ‘pre-IPO placement’ prior to the offer. If this placement is completed, the size of the fresh issue will be reduced accordingly.
The net proceeds from the IPO will be used to augment the company’s capital base to enhance solvency levels and for general corporate purposes. The proceeds from the OFS will go to the selling shareholder entities. Niva Bupa will allocate 75% of the net offer to qualified institutional buyers, 15% to non-institutional bidders, and 10% to retail investors.
Niva Bupa Health Insurance is one of the largest and fastest-growing standalone retail health insurers (SAHI) in India, with a gross direct written premium (GDPI) of Rs 5,499.43 crore in FY24. The company’s market share in the Indian SAHI market was 16.24% for FY24, insuring 14.73 million lives as of March 31, 2024.
As of March 31, 2024, Niva Bupa operates with over 143,074 agents and has 210 physical branches across 22 states and 4 union territories in India. It distributes products through 64 banks and other corporate agents, including major institutions like HDFC Bank and Axis Bank, according to a report from Redseer. The company has expanded its network of hospitals from 8,562 in March 2022 to 10,460 by March 2024, offering one of the largest networks for cashless treatment. Among these, 326 are Preferred Partner Network (PPN) Hospitals, providing additional benefits such as free ambulance services, designated relationship managers, and discounts on pharmacy, diagnostics, and consultations.
The book-running lead managers for the offer are ICICI Securities, Morgan Stanley India Company, Kotak Mahindra Capital Company, Axis Capital, HDFC Bank, and Motilal Oswal Investment Advisors, with KFin Technologies acting as the registrar. The equity shares are proposed to be listed on the BSE and NSE.
