General Insurance Corporation of India April 10, 2015 (12:00)
Issue Period
Oct 11 , 2017 - Oct 13, 2017
Price Band
Rs.855 – Rs.912 per Equity Share
General Insurance Corporation of India incorporated in November 1972 is the largest reinsurance company in India in terms of gross premiums accepted in Fiscal 2017, and Company accounted for approximately 60% of the premiums ceded by Indian insurers to reinsurers during Fiscal 2017, according to CRISIL Research.
Company is also an international reinsurer that underwrote business from 161 countries as at June 30, 2017. According to CRISIL Research, Company is ranked as the 12th largest global reinsurer in 2016 and the 3rd largest Asian reinsurer in 2015, in terms of gross premiums accepted.
General Insurance Corporation of India
| Issuer | General Insurance Corporation of India (View Report) | |
| Issue Type | 100% Book Built Issue IPO | |
| Issue Period | Issue Opens: Oct 11, 2017 | |
| Issue Closes: Oct 13, 2017 | ||
| Price Brand | Rs.855 – Rs.912per Equity Share | |
| Issue Size(Rs.) | Offer For Sale of 12,47,00,000 Equity Shares of Rs.5 Each constitute at least (*)% of the fully diluted post issue paid-up capital | |
| Face Value | Rs.5 per Equity Share | |
| Minimum Order Quantity Retail: | 16 Shares and in multiples there of | |
| QIB | 50% of the issue size (62,350,000 Equity Shares) | |
| NIB | 15% of the issue size(18,705,000 Equity Shares) | |
| Retail Individual Bidders | 35% of the issue size (43,645,000 Equity Shares) | |
| Registrar | Karvy Computershare Pvt Limited | |
| Listing | NSE & BSE | |
| Book Running Lead Managers | Kotak Mahindra Capital, Citigroup, Axis Capital, Deutsche Equities, HSBCSecurities | |
Karvy View
Leader in Reinsurance industry: GIC is the largest reinsurance company with approximately 60% of premiums ceded by Indian insurers to reinsurers during FY2017. The total gross premiums have grown at a CAGR of 48.65% during FY15-17. The company is also an international reinsurer having business across 160+ countries, growing at CAGR of 24.84% during FY15-17. The international business contributes around 43% to total gross premium accepted. The company is ranked as 12th largest global reinsurer and 3rd largest Asian reinsurer in terms of gross premiums accepted.
Diversified product portfolio: The company has diversified its reinsurance business by covering different business lines like Fire, Marine, Motor engineering, agriculture, aviation, health, liability, credit and life insurance. This diversified business model helps the company to grow across fast growing markets like SAARC, South East Asia, Latin America, Africa and China. The diversified products also allow managing exposures by limiting and mitigating risk.
Outlook: At upper price band of Rs 855-912, the stock is available at P/E of 24.9x and P/BV of 3.9x. There are no listed reinsurance companies in India. Based on Market leadership, Exponential historical growth and future potential we assign a rating of 4 out of 5.
Objects of the IPO:
- Augmenting the capital base of Corporation to support the growth of business and to maintain current solvency levels;
- General corporate purposes
Key Strategies:
- Expand and leverage leadership position in the domestic reinsurance industry and continue strong business growth
- Expand presence internationally and grow overseas business
- Focus on improving profitability through reduction in combined ratio
- Grow life reinsurance and other business lines in India and overseas markets
Public issue of 12,47,00,000 equity shares(Fresh Issue 1,72,00,000 Equity shares & offer for sale 10,75,00,000 Equity shares)of Rs. 5/- each (“equity shares”) of General Insurance Corporation of India (Company or Issuer).
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