HDFC Standard Life receives Sebi approval for IPO

HDFC Standard Life Insurance Company has received capital markets regulator Sebi's go ahead to raise an estimated Rs 7,500 crore through an initial public offering.

The insurance firm had filed draft papers with Sebi in August and obtained its "observations" on October 13, which is very necessary for any company to launch public offer, latest update with the markets watchdog showed.

The public issue comprises sale of 1,91,246,050 equity shares, amounting to 9.55 per cent stake, by HDFC Ltd and up to 1,08,581,768 scrips, or 5.42 per cent, holding by Standard Life Mauritius, according to the draft red herring prospectus (DRHP) filed with Sebi.

Currently, HDFC owns 61.41 per cent stake in HDFC Standard Life and Standard Life has about 34.86 per cent, while the remaining is with employees and PremjiInvest.

According to merchant banking sources, the initial public offer (IPO) is expected to be worth Rs 7,500 crore.

"The objects of the offer are to achieve the benefits of listing the equity shares on the stock exchanges.

"The listing of equity shares will enhance the 'HDFC Life' brand name and provide liquidity to the existing shareholders. The listing will also provide a public market for equity shares in India," HDFC Standard Life said.

HDFC Standard Life Insurance is a joint venture in the ratio of 61.41:34.86 between India's biggest mortgage lender HDFC Ltd and UK's Standard Life.

Morgan Stanley India Company, HDFC Bank, Credit Suisse Securities, CLSA India, Nomura Financial Advisory and Securities are the global co-ordinators, while Edelweiss Financial Services, Haitong Securities, IDFC Bank, IIFL Holdings, UBS Securities are the book running lead managers to the issue.

Last month, New India Assurance Company had received Sebi's nod to float an initial public offer (IPO).

Presently, ICICI Prudential Life Insurance and SBI Life Insurance are the only listed insurer in India. Moreover, state-owned General Insurance Corporation of India's IPO will list next week.