Niva Bupa IPO: 1.17x Subscribed on Final Day – Should You Invest?

The Niva Bupa IPO, closing today, has been subscribed 1.17 times, with strong demand from retail and QIB investors. The grey market premium is ₹3, indicating a 4.03% potential listing gain. Analysts suggest a “Subscribe – Long Term” rating, citing solid growth prospects and a fully priced offering.

CONTENTS:

• Niva Bupa IPO oversubscribed, closes today.
• Niva Bupa IPO: Steady demand, long-term potential.
• Niva Bupa IPO sees steady demand, moderate GMP
• Niva Bupa IPO: Moderate GMP, long-term potential

Niva Bupa IPO: 1.17x Subscribed on Final Day – Should You Invest?

Niva Bupa IPO oversubscribed, closes today

Niva Bupa IPO: 1.17x Subscribed on Final Day Niva Bupa Health Insurance IPO Day 3 Live: The Niva Bupa Health Insurance IPO, previously known as Max Bupa Health Insurance, has achieved 1.32 times subscription as of November 11, 2024, 11:33 AM. Today marks the final day of the offer.

As of this morning, the IPO has drawn bids for approximately 20.27 crore shares, surpassing the 17.28 crore shares on offer, based on NSE data. The subscription breakdown is as follows: qualified institutional buyers (QIBs) at 1.54 times, retail investors at 1.92 times, and non-institutional investors (NIIs) at 47%. There has been no subscription for the employee portion.

The IPO, with a price range of ₹70-74 per share, aims to raise ₹2,200 crore. This consists of a fresh issuance worth ₹800 crore, with an additional ₹1,400 crore offered for sale by current shareholders, including Fettle Tone LLP (₹1,050 crore) and Bupa Singapore Holdings Pte Ltd (₹350 crore). The company recently mobilized ₹990 crore through anchor investors and adjusted its total funding target from ₹3,000 crore to the current figure.

Niva Bupa IPO: 1.17x Subscribed on Final Day  Funds from the fresh issuance will support Niva Bupa’s capital base, improving its solvency, while part of the proceeds will go towards general corporate expenses. Once completed, this will be the second standalone health insurance IPO after Star Health & Allied Insurance. The shares are expected to list on both the BSE and NSE. ICICI Securities, Morgan Stanley India, Kotak Mahindra Capital, Axis Capital, HDFC Bank, and Motilal Oswal are the lead managers for this offer.

Niva Bupa IPO: Steady demand, long-term potential

Niva Bupa IPO: 1.17x Subscribed on Final Day 

Niva Bupa Health Insurance IPO Review: Should You Apply?

The Niva Bupa Health Insurance IPO, which launched on November 7, 2024, is set to close today, November 11. Investors have shown positive interest, with the IPO currently oversubscribed by 1.32 times as of 11:27 AM on the third day. In particular, the retail segment reached a 1.92-times subscription, while the Qualified Institutional Buyers (QIB) segment hit 1.54 times, and the Non-Institutional Investors (NII) segment at 0.47 times.

Grey Market Premium (GMP):
The grey market premium for Niva Bupa Health Insurance remains steady at ₹5, indicating ongoing interest despite a cautious secondary market. Analysts suggest that the GMP could increase if broader market sentiment improves.

Financial Performance:
According to Bajaj Capital, Niva Bupa Health Insurance has seen significant growth in Gross Written Premium (GWP) over the past three years, with premiums reaching ₹5,607.57 crore in FY24 and a net profit of ₹81.85 crore. Although the company reported a Q1 FY25 loss of ₹18.82 crore, analysts highlight that the insurance industry generally experiences stronger performance in the latter half of the fiscal year.

Analyst Recommendations:
Both Bajaj Capital and Canara Bank Securities have assigned a ‘subscribe for the long term’ rating to the IPO. Canara Bank Securities points to the company’s balanced channel mix, with a diversified approach through corporate agents, individual agents, and brokers contributing substantially to its Gross Direct Premium Income (GDPI) in FY24.

Niva Bupa IPO sees steady demand, moderate GMP

Niva Bupa IPO: 1.17x Subscribed on Final Day  Niva Bupa Health Insurance IPO Day 3: Subscription Status and Grey Market Premium (GMP) Update

The Niva Bupa Health Insurance IPO, previously known as Max Bupa, will close today, November 11, 2024. By 10:24 AM on the final day, the IPO had been subscribed 1.25 times, receiving bids for approximately 21.55 crore shares, compared to the 17.28 crore shares available. Specifically, the Qualified Institutional Buyers (QIB) portion was subscribed 1.5 times, retail investors 1.68 times, and non-institutional investors 0.44 times.

Grey Market Premium (GMP): The shares of Niva Bupa Health Insurance are currently trading at a ₹3 premium in the grey market, suggesting a projected listing gain of 4.05%. This GMP reflects investor sentiment and may fluctuate with market conditions.

IPO Details: The IPO opened for public bidding on November 7, with a price band of ₹70-74 per share. The offering consists of a fresh equity issuance of ₹800 crore, as well as an offer-for-sale (OFS) totaling ₹1,400 crore from existing promoters. The allotment of shares is set to be finalized on November 12, with listing expected on November 14.

Niva Bupa IPO: 1.17x Subscribed on Final Day  Promoters Bupa Singapore Holdings Pte and Fettle Tone LLP (owned by private equity firm True North) will sell shares worth ₹350 crore and ₹1,050 crore, respectively, through the OFS. The promoters currently own 89.07% of the company, with Bupa Singapore holding a 62.19% stake and Fettle Tone LLP 26.80%.

Financial Performance: Niva Bupa holds a 17.29% market share in India’s standalone health insurer (SAHI) segment, making it the country’s third-largest SAHI. It achieved a Gross Direct Premium Income (GDPI) of ₹5,494 crore in FY24, and its net profit rose to ₹81.85 crore, up from ₹12.5 crore the previous fiscal. However, operating profit dropped from ₹350.9 crore to ₹188 crore. For Q1 of FY25 (ending June 2024), it reported a loss of ₹18.8 crore, narrowing from ₹72.2 crore in the same quarter last year, with an operating profit of ₹23.2 crore.

Peer Comparison: In comparison to its peers, Star Health & Allied Insurance has an EPS of ₹14.48, a PE ratio of 36.97, and a Return on Net Worth (RoNW) of 14.35%. ICICI Lombard General Insurance leads with an EPS of ₹39.03, a PE ratio of 45.92, and an RoNW of 17.17%, while New India Assurance holds an EPS of ₹6.77, a PE ratio of 35.23, and an RoNW of 5.13%.

The book-running lead managers for the Niva Bupa Health Insurance IPO are ICICI Securities, Morgan Stanley India, Kotak Mahindra Capital, Axis Capital, HDFC Bank, and Motilal Oswal, with KFin Technologies serving as the IPO’s registrar.

Niva Bupa IPO: Moderate GMP, long-term potential

Niva Bupa IPO: 1.17x Subscribed on Final Day

Niva Bupa IPO GMP Update: Final Day to Apply – Should You Invest?

Today, November 11, 2024, marks the last day to apply for the Niva Bupa Health Insurance Company IPO, which opened on November 7. With an offering valued at ₹2,200 crore, the IPO comprises a fresh issuance of 108.1 million shares and an offer-for-sale (OFS) of 189.2 million shares. By 10:12 AM, the IPO had been subscribed 1.17 times, per NSE data.

Subscription Status by Category

Interest in the IPO has been strong, particularly from Qualified Institutional Buyers (QIBs), who have subscribed 1.50 times their allotment. Retail Individual Investors (RIIs) have subscribed 1.54 times, and Non-Institutional Investors (NIIs) have subscribed 0.43 times.

IPO Price and Grey Market Premium

The price range for the Niva Bupa IPO is set at ₹70-74 per share, with a minimum bid of 200 shares. Currently, Niva Bupa’s unlisted shares are trading at a premium of ₹3, which translates to a 4.03% grey market premium (GMP) based on the upper price of ₹74.

Allotment and Listing Dates

The basis of allotment is expected to be finalized by Tuesday, November 12, with shares credited to successful applicants’ demat accounts by Wednesday, November 13. Niva Bupa shares are anticipated to list on the Bombay Stock Exchange (BSE) and National Stock Exchange (NSE) on Thursday, November 14.

Lead Managers and Purpose of the IPO

The IPO’s lead managers include ICICI Securities, Morgan Stanley India, Kotak Mahindra Capital, Axis Capital, HDFC Bank, and Motilal Oswal, with KFin Technologies as the registrar. Funds raised from the fresh issue will go toward strengthening the company’s capital base and fulfilling solvency requirements mandated by the Insurance Regulatory and Development Authority of India (IRDAI). Niva Bupa offers a range of health insurance products and digital health services through its app and website.

Investment Recommendation

Shivam Gupta from Anand Rathi suggests a “Subscribe – Long Term” rating, indicating the IPO is fully priced with a post-issue price-to-book ratio of 6.1x and a projected market cap of ₹1,35,200 million.