You are here: Home » Markets » IPOs » News
Business Standard

Anil Ambani's Reliance General Insurance to re-file IPO document this week

Hopes to obtain pending regulatory approvals from Sebi & Registrar of Companies, to tap the market soon

Samie Modak  |  Mumbai 

IPO
Illustration: Ajay Mohanty

Despite negative investor sentiment, the Anil Ambani-led is planning an (IPO) of a group company as early as this financial year. Reliance General Insurance Company will re-file its document with market regulator Securities and Exchange Board of India (Sebi) this week, according to investment banking sources. The company is hoping to obtain pending regulatory approvals soon, and targeting to list before March-end, a source said.

Reliance General got fresh approval from insurance regulator Insurance Regulatory and Development Authority of India (Irdai). It will also need approvals from and (RoC), before it can tap the public market.

Last year, Reliance General had all the approvals in place, but couldn't launch its because of challenging market conditions and negative sentiments towards the group companies.

ALSO READ: Reliance General Insurance posts Rs 560 mn net profit, logs 20% YoY growth

While not much has changed on that front, the company and are hopeful that the would sail through as the general insurer has shown an improvement in performance.

The IPO size would be in the range of Rs 1,500 crore to Rs 2,000 crore, said a banker.

Meanwhile, Reliance General has rejigged the list of investment for the IPO.

mkt1

It has roped in Citic CSLA and IndusInd Bank to replace UBS investment company and IDBI Capital. Motilal Oswal, Credit Suisse, Edelweiss and Haitong Securities will continue to be associated with the issue.

China-based Citic CLSA was also one of the lead banks for Reliance Nippon Life Asset Management Company (AMC) — the last Anil Ambani-group firm to come out with an IPO. The asset manager's Rs 1,540-crore offering in October 2017 had garnered more than 80 times subscription.


ALSO READ: Anil Ambani's Reliance Communications lays out debt resolution plan

Just like Reliance Life AMC, Reliance General's IPO, too, will be a combination of fresh equity issuance and secondary share sale by Reliance Capital.

"No doubt the investor sentiment towards the group companies has taken a beating. But we are confident that Reliance General will be able to garner the desired amount. The company has posted impressive growth in the first half of the current financial year," said an investment banker handling the issue.

mkt12

Shares of the seven listed Anil Ambani group companies fell between 3.3 per cent and 35 per cent on Monday after Reliance Communications moved bankruptcy court National Company Law Tribunal (NCLT) to resolve its debt issue. The combined market capitalisation erosion in the seven companies was Rs 6,310 crore.

In the past one year, the Anil Ambani group has seen its market value erode by 58 per cent, or Rs 37,417 crore, to Rs 26,948 crore, amid rising indebtedness.

The IPO plan signals that the group is confident that the debt trouble at group companies, including Reliance Communications, won't spill over to Reliance General. Through the IPO, general insurance arm could be valued anywhere between Rs 6,000 crore and Rs 8,000 crore, said a banker.

Sebi's approval for an IPO is valid for a period of one year. Reliance General's previous nod had expired in November. Typically, takes more than two months to vet and approve an IPO. However, in case of re-filing, the process gets completed early, said

First Published: Mon, February 04 2019. 22:54 IST
RECOMMENDED FOR YOU