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SBI looks to sell 80 mn shares in SBI Life IPO

LiveMint logoLiveMint 10-07-2017 Anirudh Laskar

Mumbai: State Bank of India (SBI) on Monday said it will offer 80 million shares to the public in the proposed initial public offering (IPO) of SBI Life Insurance Co. Ltd.

In March, SBI held 701 million shares or 70.1% in SBI Life, while the rest were held by BNP Paribas Cardif (26%), private equity firm KKR (1.95%) and Singapore-government-owned investment company Temasek (1.95%).

On Friday, Mint reported the insurance regulator has approved SBI Life’s IPO application, seeking to raise as much as Rs7,000 crore, the largest such share sale by a life insurer in India. SBI Life, which will be the second insurer after ICICI Prudential Life Insurance Co. Ltd to sell shares to the public in India, has hired BNP Paribas, Citi, Kotak Investment Bank and Axis Capital to manage the initial share sale.

“The firm could sell shares amounting to a 12% stake, raising Rs6,000-7,000 crore,” said the Mint report, citing two people with direct knowledge of SBI Life’s plans.

At the end of March 2016, SBI Life’s embedded value was at around Rs12,999, according to a presentation by the company. According to current estimates by bankers and analysts, this value has gone up by at least 17%, which means the embedded value of SBI Life currently stands at around Rs15,200 crore.

SBI Life’s net profit grew 10.9% to Rs 954.65 crore in the year ended 31 March from Rs 861.03 crore in the previous year.

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