The insurance regulator IRDAI has given in-principle approval for the initial public offering of SBI Life Insurance, which is a subsidiary of the country's biggest bank, the State Bank of India. When launched, the IPO will be the second by a life insurer in India.
SBI Life is expected to raise INR7,400 crore (US$1.15 billion) to INR8,500 crore through the IPO, which would value the company at INR65,000-70,000 crore, local media reports say.
SBI Life is likely to file a draft prospectus with the capital market regulator Securities and Exchange Board of India soon. SBI will approach the insurance regulator again for the final approval after the SEBI's green light.
SBI Life is a joint venture between State Bank of India and BNP Paribas Cardif. SBI holds a 70.1% stake in the insurer and BNP Paribas Cardiff 26%. Private equity firm KKR and Singapore-government owned investment company Temasek hold 1.95% each in the life insurer.
SBI Life is the second largest private life insurer in India after ICICI Prudential which is currently the only listed insurance company in India. Its shares were floated last year.