Niva Bupa to raise ₹3,000 cr via IPO; files DRHP with SEBI

Niva Bupa plans to raise ₹3,000 crore via IPO, revealed the draft red herring prospectus filed by the health insurance company with the market regulator Securities and Exchange Board of India.

“(The company) has filed the draft red herring prospectus with the SEBI, BSE Limited and National Stock Exchange of India Limited in connection with the initial public offering of equity shares of face value of ₹10 each,” read the company’s intimation statement on NSE.

Fresh shares worth ₹800 crore will be issued by the company as part of the initial offering. Existing shareholders, Bupa Singapore Holdings and Fettle Tone will sell shares worth ₹320 crore and ₹1,880 crore respectively, amounting to the remaining offer-for-sale of ₹2,200 crore of the IPO. The insurance firm plans to use the sale proceeds to strengthen its capital base and finance its general operating expenses.

As per the initial disclosures made by the company at the end of March 2024, the health insurer’s outstanding borrowings stood at ₹250 crore, unchanged for the third straight fiscal year. Total income of the company including net premium income, investment income, and other income, saw a 44% year-on-year increase.

The book-running managers for the company’s IPO include ICICI Securities, Morgan Stanley, Kotak Mahindra Capital, Axis Capital, HDFC Bank Ltd., and Motilal Oswal Investment Advisors Ltd.

Niva Bupa is one of the many companies planning to go public this year. Around $4 billion have been raised by more than 100 companies via IPOs this year, a little over twice the amount raised last year according to LSEG data, a global provider of financial markets data and infrastructure.

Niva Bupa Health Insurance Company Limited erstwhile Max Bupa Health Insurance is a joint venture between the Bupa Group and Fettle Tone LLP. Bupa or British United Provident Association Limited is a UK-based healthcare services company with a customer base of 5 crore in over 190 countries. Fettle Tone LLP is an entity controlled and managed by True North, one of India’s largest domestic private equity funds. As of March 31, 2023, the promoters Fettle Tone LLP held 54.45% of shares and Bupa Singapore Holdings Pvt. Ltd. held 44.37% of shares in the company. Bupa was a founding shareholder of the 2008-founded insurance giant. True North in 2019 became a majority shareholder by a ₹511 crore worth stake acquisition.