Niva Bupa attracts investor interest

Niva Bupa

MUMBAI: According to two people familiar with the situation, Temasek Holdings, Warburg Pincus, and the Canada Pension Plan Investment Board (CPPIB) are eager to take part in the impending $100 million fundraising effort by Niva Bupa Health Insurance Ltd.

The individuals listed above spoke on the condition of anonymity and stated that the True North-backed health insurer anticipates a valuation of $2 billion for the pre-IPO capital raise. One of the two individuals, who wished to remain anonymous, stated that the potential investors have already started their due diligence on the business.

The second individual said, “Bids are due on April 10.”

In order to rebalance the capitalization table in advance of the IPO, True North may also sell a portion of its interest, according to the first speaker. They claimed that several public market investors, in addition to Temasek, Warburg, and CPPIB, have also indicated interest. Nevertheless, they chose not to name these investors.

The second individual claims that the business plans to go public in two to three years.

Requests for comment from True North, Warburg Pincus, and Niva Bupa spokespeople went unanswered. Temasek and CPPIB spokespeople declined to comment.

Jointly owned by British United Provident Association Ltd. and the private equity firm True North, Niva Bupa is a subsidiary of Bupa Singapore Holdings (Bupa).

With its special purpose vehicle Fettle Tone, True North paid Max India Ltd. 510 crore in 2019 to buy a 55.6% share in the insurance firm. The remaining equity in the project is owned by Bupa. According to regulatory records, Axis Bank purchased 9.9% of Fettle Tone for 90.8 crore in March 2021.

According to the insurer’s annual report, gross written premium increased by 60% to $2,810 crore in FY22 compared to FY21. Its underwriting loss increased from 107.71 crore the year before to 313.93 crore in FY22. Compared to the prior year’s net loss of 49.74 crore, the net loss for FY22 increased to 196.53 crore.

According to a Care Ratings study dated March 2022, “The promoters have been supporting the company in the form of regular stock infusions as indicated by an equity injection of 145 crore in FY2020, 280 crore in FY2021, and 125.1 crore in 9MFY22.”