New India Assurance: IPO proceeds to help maintain solvency margin over 2 times
1 min read . Updated: 30 Oct 2017, 08:28 PM ISTCurrently, New India Assurance's solvency margin stands at 2.27 times as against the regulatory requirement of 1.5 times
Home >Market >Stock-market-news >New India Assurance: IPO proceeds to help maintain solvency margin over 2 times
New Delhi: New India Assurance (NIA), the country’s largest general insurance company, on Monday said a part of the proceeds from Rs9,600 crore initial public offer (IPO) would help maintain solvency margin over 2 times.
“General insurance industry is growing at 20%. More business means more capital. We would like to maintain solvency over 2 times with the fund raised through fresh equity issuance," NIA chairman and managing director G. Srinivasan said in New Delhi during a roadshow of the IPO.
Currently, solvency margin stands at 2.27 times as against the regulatory requirement of 1.5 times. Talking about his company’s global expansion plans, he said: “We have plans to get into Myanmar, Dubai International Financial Centre, and Qatar." The company is already present in 28 countries with largest operation in London.
The IPO, which hits the market on 1 November, comprises sale of 9.6 crore shares by the government, besides fresh issue of 2.4 crore shares. Thus a total of 12 crore shares of NIA would be sold through the share sale offer, constituting around 14.56% of the company’s post issue share capital.
The IPO’s price band has been set at Rs770-800 per equity share of face value of Rs5 each. A discount of Rs30 on the offer price is being given to retail investors and eligible staffers of the company bidding in the employee reservation portion. At the upper end of the price band, the IPO will fetch Rs9,600 crore.
New India Assurance has assets of over Rs69,000 crore and has been growing at compounded annual growth rate of over 15% for the last five years. The company’s net worth, including fair value of investments, increased to over Rs38,100 crore as of June-end. Its market value of investments stood at Rs63,100 crore at the end of June quarter.
Click here to read the Mint ePaperMint is now on Telegram. Join Mint channel in your Telegram and stay updated with the latest business news.
×![]()