Insurance companies apply big in Policy Bazaar's Rs 5,600 crore IPO

Insurance companies have emerged as the big bidders for shares of PB Fintech, the company that operates Policy Bazaar and Paisa Bazaar portals. ICICI Prudential Life, Max Life, Niva Bupa, Bajaj Life and HDFC Life are among insurance companies that have got allotment in the anchor category ahead of PB Fintech’s Rs 5,600-crore IPO, which opens on Monday. 

Some other funds that have got allotment in the anchor category are New World, Baillie Gifford, Fidelity and Abu Dhabi Invesment Authority.

A total of 26.2 million shares have been allocated to over 150 funds at Rs 980 per share, disclosure made to stock exchanges show. Total allotment in the anchor category is for shares worth Rs 2,570 crore.

Sources said the anchor book generated demand exceeding 40 times the shares on offer. 

Policybazaar is a web aggregator where consumers can compare insurance products of various companies and buy them. Experts said insurance companies bidding in the anchor category would be seen as positive by the market.

At Rs 980, PB Fintech is valued at Rs 44,000 crore. The company is looking to raise Rs 3,750 crore in fresh capital through the IPO.

Net proceeds from the public offering (fresh issue) will be used to enhance the visibility of the brand. The company said it will use around Rs 1,500 crore out of the net proceeds to fund marketing initiatives over the next three years.

Further, it intends to utilise Rs 375 crore to expand the consumer base, including offline presence; Rs 600 crore for strategic acquisitions and investments; Rs 375 crore for expanding presence outside India; and some portion for general corporate purposes.

Kotak Mahindra Capital, Morgan Stanley, Citigroup Global Markets India, ICICI Securities, HDFC Bank, IIFL Securities, and Jefferies India are the book running lead managers to the issue. 

PB Fintech IPO will close on Wednesday.