PB Fintech shares tank nearly 7% on fundraise for international foray

Shares of Policybazaar parent PB Fintech fell sharply after it announced plans to raise funds via QIP to pursue inorganic expansion in overseas markets

Shares of PB Fintech, the parent company of Policybazaar, fell over 7 per cent on Tuesday after the company announced plans to raise funds through a qualified institutional placement (QIP) to pursue inorganic business expansion in international markets. The decline came on a day when the broader market gained 2.54 per cent, or 2,072 points.

 

By the close of trade, the stock recovered marginally to end at Rs 1,462.25 on the BSE, down 6.41 per cent from the previous close.

 

During the analyst call, the management said it has been evaluating overseas markets over the past three to four years, including the Middle East, Southeast Asia and Europe.

 

 

“We have spent the last three to four years looking across markets — the Middle East, Southeast Asia and European markets. We evaluate these opportunities based on market size and our ability to transform those markets. While we have not identified any specific target yet, this is an area we want to work towards and are fairly convinced is the right move at a stage when our Indian business is very strong,” the management said.

 

Analysts at Macquarie Capital flagged risks associated with unrelated diversification.

 

“PB Fintech announced that it is planning a board meeting to approve a qualified institutional placement (QIP) to pursue inorganic opportunities in local or international markets through strategic investments, acquisitions or partnerships. There have been concerns around capital allocation following the earlier hospital venture and now with expansion into international markets,” said Suresh Ganapathy, managing director and head of financial services research at Macquarie Capital.

 

Earlier this year, PB Fintech raised $218 million in a seed round for a new healthcare venture, PB Health. The investment will be used to establish its initial hospital network in the Delhi NCR region and to accelerate product development and technological innovation. PB Health said its initial focus will be on setting up a 1,000-bed hospital network in Delhi NCR, with plans for phased expansion.

 

Analysts at JM Financial said, “The company has also proposed a QIP, subject to board approval, to fund international expansion. With the healthcare foray already demanding management bandwidth, we believe this could lead to further volatility.”

 

PB Fintech is sitting on a cash pile of over Rs 5,000 crore, and the proposed QIP suggests the possibility of a large acquisition, which could result in 5–6 per cent dilution.

 

“While management indicated that any acquisition would be EPS-accretive, it would need to be executed at a significant valuation discount, as Indian markets are unlikely to assign PB Fintech’s current trading multiple to an international entity,” the analysts added.

 

PB Fintech reported a 165 per cent year-on-year (YoY) growth in net profit to Rs 189 crore in Q3FY26, supported by healthy income growth. Operating revenue rose 37 per cent to Rs 1,771 crore from Rs 1,291.6 crore in the corresponding quarter last year.