SBI Life Insurance, a subsidiary of the country’s largest lender SBI, will hit the capital market on 20 September to raise up to Rs 8,400 crore. The initial share sale offer will open on 20 September and will remain open until 22 September, State Bank of India said in a regulatory filing to the stock exchanges. This would be the second listing of a life insurer after ICICI Prudential Life Insurance, which went public last year. SBI Life IPO is the largest public offer in last seven years.

IPO details

The price band for the public offer has been fixed between Rs 685 to Rs 700 per share of face value Rs 10 each, company said in an exchange filing. At the upper end of the price band, the company will raise Rs 8,400 crore. Investors can bid for the IPO with a minimum of 21 shares. SBI Life’s public issue involves its promoters offloading up to 12 crore shares of face value of Rs 10 each through the offer of sale route.

State Bank of India will dilute up to 8 crore shares while BNP Paribas Cardif SA will offload up to 4 crore. The book running lead managers to the offer are JM Financial Institutional Securities, Axis Capital, BNP Paribas, Citigroup Global Markets India, Deutsche Equities India, ICICI Securities, Kotak Mahindra Capital Company and SBI Capital Markets.

IPO proceeds

Explaining the rationale behind the IPO, SBI Life said the company wants to achieve the benefits of listing equity shares on the stock exchanges and to carry out the sale of up to 12 crore equity shares by the selling shareholders. The listing will enhance the “SBI Life” brand name and provide liquidity to the existing shareholders and our company will not receive any proceeds from the offer, it added.

Company profile

SBI Life Insurance is a joint venture between India’s largest lender SBI and BNP Paribas Cardif (BNPPC) — the insurance holding company of France. SBI holds 70.1% and BNPPC 26% in SBI Life respectively. Minority shareholders Value Life Pte, an affiliate of KKR Asian Fund and MacRitchie Investments Pte, a wholly-owned subsidiary of Temasek Holdings, hold 1.95% each.

Financials

SBI Life has reported a rise of 21% in the consolidated net profit to Rs 4,464.78 crore for the financial year ended 31 March 2017 as compared to Rs 3,690.97 crore in the last fiscal. The total revenue had grown 58% to Rs 30,277.5 crore in FY 2017 versus Rs 19,119.72 crore in FY 2016.