Policybazaar, a startup that offers online comparison and features to buy insurance policies, has submitted an application to the Securities and Exchange Board of India (SEBI) for an initial public offering (IPO) of INR 6017.50 crore.
Backed by a host of marquee investors such as Softbank, Temasek, Info Edge, Tiger Global and Premji Invest online insurance aggregator policybazaar has estimated the company’s valuation to be around $6 billion.
According to policybazaar’s draft red herring prospectus (DRHP), the IPO will consist of a fresh issue of equity shares worth INR 3,750 crore and an offer for sale (OFS) of INR 2,267.50 crore by existing shareholders. SoftBank is going to sell the largest stake in the OFS of policybazaar IPO. It is also learned that Jefferies, HDFC and IIFL Securities are also part of the I Bankers group of the deal.
Shardul Amarchand Mangaldas Law Firm is going to help the company in bringing the issue. Cyril Amarchand Mangaldas Law Firm is going to assist bankers in IPO. In addition, Latham and Watkins and Linklaters will serve as International Legal Counsel.
Policybazaar will use the fund to enhance brand visibility
Policybazaar.com allows its customers to compare Auto, Health, Life Insurance, and General Insurance policies to overview features, etc. The policy market site attracts 100 million visitors every year and the company sell 4 lakh policies every month, it said in a statement.
The company will utilize approximately INR 1,500 crore from the funds raised through the market for “enhancing the visibility” of its brands, according to the draft red herring prospectus (DRHP).
It also said that the funds would be utilized to expand growth initiatives to increase the consumer base, including offline presence, funding investments and new acquisitions, and expansion outside India.
Four IPOs in a week
In the first four months of the current financial year, 12 companies have raised Rs 27,000 crore through IPOs. This week four companies will compete through IPOs to attract the attention of investors. The four major companies whose IPO will be eyeing investors this week are Windlas Biotech, Devyani International, Krishna Diagnostics and Exxaro Tiles.
Policybazaar has also announced its offline expansion as a broker and has set up 15 stores in different parts of the country. The company may expand to 100 soon. The company has said that the physical store will allow customers to have a better experience.