PolicyBazaar is the online insurance platform backed by SoftBank Group, which intends to go public in 2021 with a mega valuation of $3.5 billion, probably becoming India’s first mega startups to debut with an initial public offering (IPO).
Co-founder Yashish Dhaiya spoke to a news agency that the startup is planning to acquire about $250 million in a round of financing at a $2 billion-plus valuation before September 2021 initial public offering (IPO).
Dhaiya also told Bloomberg News that PolicyBazaar is now selecting two or three IPO managing Underwriters from a list that includes several Wall Street Banks.
Yashish Dahiya, the CEO of ETech Aces Marketing and Consulting Pvt. Ltd. which is the parent organisation of PolicyBazaar says that “The IPO size will be about $500 million”, and also said, “We have the global interest and will raise in the coming weeks for the pre-IPO financing”.
Tiger Global Management and Tencent Holdings Ltd. along with SoftBank Group Corp.’s Vision Fund are among the PolicyBazaar’s largest funders. Lemonade Inc. is a fellow SoftBank backed insurer which ascended in its debut in the United States last month had set the hopes for the startup to perform same in India.
PolicyBazaar is aiming to list in Mumbai and also is considering for dual listing if the rule changes as India is improving regulations to help companies list abroad. Currently, lots of startups started registering themselves in the U.S. or Singapore to avoid India’s strict public listing rules. Both SoftBank and Singapore-based investment firm Temasek are holding about a 15% stake each in Policybazaar, while Tiger Global and Tencent holds around 8-10% stakes respectively.
The PolicyBazaar is having rivals like Paytm which is backed by Amazon.com Inc. and Alibaba Group Holding Ltd., that is trying to capture a big size of India’s under-insured or non-insured population. According to the India Brand Equity Foundation, the insurance penetration hung at less than 4% in 2017.
As the economic ambiguities are rising India’s growing middle classes are learning more about the retirement insurance plans and health plans so that they can safeguard their future by investing in these plans, which could help the industry to generate revenues amounting to $280 billion in this particular year and also have a growth rate around 14% to 15% in the upcoming three years.
Dahiya also said that the Indian Middle-Class Groups rarely had health or life insurance, and he also added that less than 25% of the 45 million Indians have currently subscribed for an individual health plan that only covers for the chronic diseases like diabetes and high blood pressure.
Dhaiya completed his interview by stating that “The rest of them have ‘a’ plan, But middle India has no support at all”.