Retail health insurer Niva Bupa Health Insurance Company Ltd has fixed the price band of ₹70 to ₹74 per equity share of face value ₹10 each for its maiden initial public offer (IPO). The public issue will open on Thursday, November 07, 2024, for subscription and close on Monday, November 11, 2024. Investors can bid for a minimum of 200 equity shares and in multiples of 200 thereafter.
The IPO is a mix of fresh issues of up to ₹800 crore and an offer of sale of up to ₹1,400 crore by Bupa Singapore Holdings Pte. Ltd., Fettle Tone LLP.
The company says the proceeds from its fresh issuance will be used to the extent of ₹1,500 crore for the augmentation of capital base to maintain and strengthen solvency levels; and general corporate purposes.
As of June 30, 2024, Niva Bupa, which claims to be India’s 3rd largest and 2nd fastest-growing standalone retail health insurer (SAHI) based on an overall health gross direct premium income (GDPI) of ₹5,49,400 crore in fiscal 2024, has insured 14.99 million lives. The company grew at a CAGR of 41.37% from fiscal 2022 to 2024 almost double the industry’s average.
“Niva Bupa uses machine learning-based algorithms and logistics regression models to identify fraudulent claims, and this has helped them drive higher success in fraud detection, and reduce investigation referrals, thereby minimising the impact on the customer experience,” says the company.
From fiscal 2022 to fiscal 2024, Niva Bupa's overall gross written premium (GWP) increased at a compound annual growth rate (CAGR) of 41.27%, while its retail health GWP grew at a CAGR of 33.41%. “The company's overall health GDPI growth of 41.37% during this period is one of the highest among SAHIs and nearly double the industry's average growth rate of 21.42%,” says Niva Bupa says citing a Redseer report.
For the three months ended June 30, 2024, the overall GWP grew at 30.84% and its GWP from retail health grew at 31.99%.
Niva Bupa's market share in the Indian SAHI market was 16.24% for the fiscal 2024, based on retail health GDPI and for the five months ended August 31, 2024, stood at 17.29%, the Redseer data shows.
ICICI Securities Ltd, Morgan Stanley India, Kotak Mahindra Capital, Axis Capital, HDFC Bank and Motilal Oswal Investment Advisors are the book-running lead managers and KFin Technologies is the registrar of the offer.
The offer is being made through the book-building process, wherein not less than 75% of the net offer will be available for allocation on a proportionate basis to qualified institutional buyers, not more than 15% of for non-institutional bidders, and not more than 10% for retail bidders.
