Policybazaar Rs 5,709.72 crore IPO opens next week, know all the details

The Rs 5,709.72 crore initial public offer of PB Fintech, parent company of online insurance aggregator Policybazaar, will open next week on November 1. Here are all the details that you need to know about the issue:

Open and close date: The offer will open for subscription on November 1 and will close on November 3. The anchor book, if any, will open for a day before the issue on October 31.

Price band: The price band for the insurance aggregator has been fixed at Rs 940-980 per share having a face value of Rs 2 per share.

Lot size: Investors can bid for a minimum of 15 equity shares and in multiples, thereafter, translating to a minimum bidding amount of Rs 14,700 at the higher end of the price band. A retail investor can at maximum apply for 13 lots or 195 shares for Rs 1,91,100.

Issue size: The Rs 5709.72-crore public offer comprises fresh issuance of equity shares of Rs 3,750 crore, along with an offer for sale (OFS) of Rs 1959.72 crore by existing promoters and shareholders. The OFS would be driven by investor SVF Python II (Cayman), which would be selling shares worth Rs 1,875 crore.

Objective of issue: The fintech company will utilise the net proceeds from the fresh issue towards enhancing visibility and awareness of company’s brands, including but not limited to ‘Policybazaar’ and ‘Paisabazaar’. An amount of Rs 1,500 crore is earmarked for this purpose. An amount of Rs 375 crore would be deployed for exploring new opportunities to expand company’s consumer base, including offline presence. While Rs 600 crore is set aside for funding strategic investment & acquisitions, Rs 375 crore will be employed for expanding presence outside India and for general corporate purpose.

What’s in it for retail investors: Not more than 75% of the total offer has been reserved for qualified institutional buyers, up to 10% for retail investors, and the rest 15% for non-institutional buyers.

About the company: PB Fintech is India’s leading online platform for insurance and lending products. The company provides convenient access to insurance, credit, and other financial products and aims to create awareness in India about the financial impact of death, disease, and damage. The company operates two verticals namely Policybazaar & Paisabazaar. According to Frost & Sullivan, Policybazaar was India’s largest digital insurance marketplace with a 93.4% market share based on the number of policies sold in Fiscal 2020. Also, in the same year, 65.3% of all digital insurance sales in India by volume were transacted through Policybazaar. While Paisabazaar was India’s largest digital consumer credit marketplace with a 51.4% market share, based on disbursals in Fiscal 2020.

On the financial front, the company’s net loss halved to Rs 150.02 crore for the year ended FY21 compared to a loss of Rs 346.81 crore in FY19. Whereas its total revenues jumped to Rs 855.56 crore versus Rs 528.80 crore. For the quarter ended June 2021, the company posted a loss of Rs 110.84 on a revenue of Rs 258.17 crore.

Book running lead managers and registrar to the IPO: The book running lead managers to the issue are Kotak Securities, Morgan Stanley, Citigroup Global Markets, ICICI Securities, HDFC Bank, IIFL Securities and Jefferies. The registrar to the issue is Link Intime.

Issue timeline: The issue is likely to finalize the basis of allotment by November 10, and the initialisation of refunds will take place by November 11. While the credit of equity shares to depository accounts of the allottee will be done on November 12. The fintech company is expected to make its stock market debut on November 15, 2021.