Issue Highlights
Issue Period
|
19/9/2016-21/9/2016
|
Price Band (Rs.)
|
300-334
|
Issue Size(shares)
|
18,13,41,058
|
Issue Size (Rs. crore) #
|
6056.79
|
Issue Type
|
100% Book built
|
Face Value (Rs.)
|
10
|
Listing
|
BSE,NSE
|
Industry
|
Life Insurance
|
Registrar
|
Karvy Computershare
|
Minimum Bid Quantity
|
44 shares
|
Maximum Retail Subscription
|
Rs. 1,91,048 (13 lots)
|
BRLM
|
HSBC, IIFL,JM Fin, SBI cap, UBS
|
# derived figure
Issue Details
Offer for Sale by the
promoter ICICI Bank: 18,13,41,058
Fresh Issue: Nil
Equity Shares
Outstanding Prior to the Issue: 1,43,53,24,010
Equity Shares
Outstanding After The Issue :1,43,53,24,010
Objects of the Issue
This issue being a
pure offer for sale by its promoters, company shall not receive any proceeds
from the offer. This issue shall fetch listing benefits to the company besides
enhancing its brand value and providing liquidity to the existing shareholders.
Industry Profile
The Indian insurance
sector was estimated to be of Rs. 3.7
trillion on a total premium basis for FY 2016, and it is ranked as the 10th
largest insurance market in the world. India still remains an underpenetrated
insurance market with a life insurance penetration of 2.7 % only.
Company Profile
The company enjoys
the status of being largest private insurance player of India in total premium
terms and AUM. It’s a joint venture between ICICI bank and Prudential
Corporation Holdings Limited. IPLICL offers a range of life insurance, health
insurance and pension products & services.
On RWRP basis
company enjoys the market share of 11% among all insurance players (including
public sector player) whereas among private sector players its market share is 22 %.The company has a wholly
owned subsidiary, ICICI Prudential Pension Funds Management Company Limited.
Risks & Threats
(1)
Indian
life insurance sector being highly competitive, makes it difficult to sustain
the growth with a looming threat of consolidation of competitors . Presently,
there are 24 competitors in the field including the public sector player- LIC-the
market leader with the 48 % of the market share, and there exists a risk of
consolidation of a few resulting in a bigger entity
(2)
Around
59 % of company’s unguaranteed AUM
(Assets Under Management) are unit-linked and thus prone to market downturns.
Though the burden of capital markets going down is borne by the policy holders
but these downturns negatively affects
company’s profitability
(3)
Around
14% of capital-protected AUM shall ensure a hole in company’s profitability in
case of a market downturn
(4)
Around
53 % of company’s investment being in debt instruments , fluctuating interest
rates are detrimental for its
profitability
(5)
Alike
all insurance companies , it is prone to acts of God.
(6)
Around
55 % of the total premium received comes from the 5 states viz. Maharashtra, Karnataka,
Tamilnadu, Gujarat and Delhi and such geographic concentration has its
drawbacks
(7)
The
growth in Indian insurance market is highly uncertain and the CAGR has been
varied from 11 % to -5 % in the past 9
years.
(
Financial Profile #
Parameter
|
FY
16
|
PE Ratio
|
29.01
|
Price to Book
|
9.01
|
ROE (%)
|
31.05
|
PEG profit
|
6.44
|
Profit CAGR 4 years
|
4.5
|
# using upper end of
the price-band
Acronyms
used:
RWRP : Retail weighted Received Premium
APE:
Annualized Premium Equivalent
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