State-owned insurance behemoth Life Insurance Corporation of India (LIC) and Digital Security firm eMudhra have got the Securities Exchange Board of India's (SEBI) approval to launch initial public offerings (IPOs).
Government promoted LIC, will be a comprehensive offer-for-sale (OFS) of up to 316,249,885 equity shares by the President of India through the Ministry of Finance, Government of India ("Selling shareholders"). The offer also includes not more than 5% reservation for its eligible employees and not more than 10% for its policyholders.
LIC was created on September 1, 1956, when 245 private life insurance companies in India were merged and nationalised. It is the country's largest life insurer with a market share of 64.1 percent in terms of premiums. According to Brand Finance report, LIC's brand is the third strongest and tenth most valuable worldwide insurance brand. The present worth of earnings tied to a brand's reputation is the value of a brand. As of September 30, 2021 the embedded value of LIC is Rs 5.40 trillion.
LIC had an asset under management (AUM) of Rs 39.74 trillion as of September 30, 2021, which was more than three times the total AUM of all private life insurers in India, approximately 16.2 times the AUM of the second-largest player in the Indian life insurance industry, and 1.1 times the entire Indian mutual fund industry.
The insurance behemoth had a 66.2 percent market share in terms of New Business Premium (or NBP), 74.6 percent in terms of number of individual policies issued, 81.1 percent in terms of number of group policies issued, and a 55 percent market share in terms of individual agents as of September 30, 2021.
Kotak Mahindra Capital Company Limited, Axis Capital Limited, BofA Securities India Limited, Citigroup Global Markets India Private Limited, JM Financial Limited, J.P. Morgan India Private Limited, Goldman Sachs (India) Securities Private Limited, ICICI Securities Limited, Nomura Financial Advisory and Securities (India) Private Limited and SBI Capital Markets Limited are the book running lead managers to the issue.
eMudhra Limited filed draft papers in November 2021 with Sebi. The IPO consist of fresh issue of Rs200 crore and an offer for sale of up to 8,510,638 equity shares by its existing promoters and shareholders.
The Offer for Sale comprises up to 3,289,257 equity shares by Venkatraman Srinivasan, up to 3,191,490 equity shares by Taarav Pte Ltd (The Promoter Selling Shareholders"), up to 510,638 equity shares by Kaushik Srinivasan, up to 504,307 equity shares by Lakshmi Kaushik, up to 881,869 equity shares by Arvind Srinivasan and up to 133,077 equity shares by Aishwarya Arvind (The "Other Selling Shareholders").
The proceeds from its fresh issuance worth Rs 35 crore will be utilised for the repayment or prepayment of borrowings, in full or part of all or certain borrowings; Rs 40.22 crore for funding working capital requirements; Rs 46.36 crore for purchase of equipment's and funding of other related costs for data centres; Rs 15.03 crore for funding of expenditure related to product development; Rs 15.27 crore for investment in the company for development, sales, marketing for future growth and general corporate purposes.
eMudhra is the largest licensed Certifying Authority ("Certifying Authority" or "CA") in India with a market share of 37.9% in the digital signature certificates market space in FY 2021, as per the Frost & Sullivan Report, represented in its DRHP document. It is a one stop shop player in secure digital transformation.
The Bengaluru-based firm is engaged in the business of providing Digital Trust Services and Enterprise Solutions to individuals and organisations functioning in various industries.
IIFL Securities Limited, Yes Securities (India) Limited and Indorient Financial Services Limited are the Book Running Lead Managers of the issue.