PolicyBazaar Submits DRHP to SEBI, Set to Raise Rs. 6,017.50 Crores through IPO

5 August 2022
4 mins read
PolicyBazaar Submits DRHP to SEBI, Set to Raise Rs. 6,017.50 Crores through IPO

PolicyBazaar, India’s largest online insurance aggregator has filed its draft red herring prospectus (DRHP) with SEBI. It aims to raise Rs. 6,017.50 crores via an initial public offering. The IPO will consist of a fresh issue of Rs. 3,750 crore shares along with an offer for sale (OFS) of Rs. 2,267.50 crores by its current promoters and shareholders.

PolicyBazaar: A Close Look into the Company

PolicyBazaar is one of the leading online platforms offering a diverse range of insurance plans like life insurance, health insurance, travel insurance, motor insurance, and more. In addition, it was one of the first online platforms to compare and buy insurance policies from various insurers.

The company is backed by a host of marquee investors and claims to sell more than 4 lakh policies every month. Established in 2008, PolicyBazaar has managed to secure Rs. 410 crores in investment. Yashish Dahiya and Alok Bansal founded it.

What’s Brewing with the PolicyBazaar IPO?

According to individuals familiar with the developments, PolicyBazaar has targeted a valuation of around $5.5 – 6 billion. Softbank will lead the offer for sale of PolicyBazaar IPO.

The company seeks to utilise the funds raised from its IPO as growth capital and for financing its expansion plans.

The book running lead managers to PolicyBazaar IPO are as follows:

  • Kotak Mahindra Capital
  • Citigroup Global Markets India
  • Morgan Stanley
  • HDFC Bank
  • ICICI Securities
  • Jefferies India
  • IIFL Securities

Cyril Amarchand Mangaldas has been appointed as counsel to the bankers, while Shardul Amarchand Mangaldas will act as the company counsel. Latham and Watkins, and Linklaters will be international legal counsel.

PolicyBazaar is yet to announce its IPO dates. However, company sources say that it wishes to launch the IPO by December 2021.

How Has Been the Financial Performance of PolicyBazaar so Far?

PolicyBazaar has come a long way since it was founded in 2008. It claims to have hit around 10 million customers in fiscal 2019. Moreover, over 40 insurers have partnered with it to sell their policies on PolicyBazaar.

PolicyBazaar has registered a loss of Rs. 218 crores over revenue of Rs. 515 crores in FY20. However, in FY19, it suffered a loss of Rs. 213 crores on revenue of Rs. 310 crores. Interestingly, it had acquired an insurance broking license from the Insurance Regulatory and Development Authority of India earlier in 2021.

Etech Aces Marketing and Consulting is the firm that houses PolicyBazaar. PolicyBazaar’s list of investors features a list of several heavy-weight names, including:

  • Softbank
  • Premji Invest
  • Tiger Global
  • Temasek
  • Info Edge
  • True North
  • Investus
  • Steadview Capital
  • Wellington Management
  • Ribbit Capital
  • Chiratae Ventures

Parting Words

According to PolicyBazaar CEO Yashish Dahiya, India has around 6 crore families that can afford private insurance right now, out of which only 15% has an insurance cover. He adds that this figure will jump to 15 crores within a decade. So, there is enough room for PolicyBazaar to expand its market post-IPO.

However, not much detail about the PolicyBazaar IPO is available at present. Nonetheless, investors interested in subscribing to PolicyBazaar IPO can stay updated about recent developments in the stock market and finances with Angel One blogs.

 

Frequently Asked Questions

Where will PolicyBazaar IPO be listed?

– Both on the BSE and NSE

What is the price band of PolicyBazaar IPO?

– Not yet decided

How can I subscribe to PolicyBazaar IPO?

– You can subscribe to the IPO through the ASBA facility against your savings or current accounts or by filling the necessary BSE or NSE forms. You can also create a DEMAT account with Angel One to subscribe to the PolicyBazaar IPO.

Can I use UPI to apply for IPO?

– Yes, you can. You need to have a valid UPI ID linked with your bank account.