HDFC Standard Life Insurance IPO

HDFC Standard Life Insurance IPO

HDFC Standard Life IPO

Business description from prospectus - HDFC Standard Life Insurance is the most profitable life insurer, based on Value of New Business (VNB) margin, among the top five private life insurers in India (measured on total new business premium) in Fiscal 2016 and Fiscal 2017. Besides consistently being among the top three private life insurers in terms of profitability based on VNB margin, it has also consistently been among the top three private life insurers in terms of market share based on total new business premium between Fiscal 2015 and Fiscal 2017, according to CRISIL. Between Fiscal 2015 and Fiscal 2017, its annualised premium equivalent grew by a CAGR of 14.5%. Its 13th month individual persistency ratio was 73.3%, 78.9%, 80.9% and 81.5% for the period ended March 31, 2015, March 31, 2016, March 31, 2017 and June 30, 2017, respectively.

The company has a healthy balance sheet with total net worth of INR41.5 billion and a solvency ratio of 197.5% as at June 30, 2017, above the minimum 150.0% solvency ratio required under IRDAI regulations. HDFC Standard Life insurance generated Profit After Tax of INR8,869.2 million and delivered a Return on Equity of 25.6%, Return on Invested Capital of 40.7% and Operating Return on Embedded Value of 21.7% during Fiscal 2017. As at June 30, 2017, it had total AUM of INR947.5 billion and Indian Embedded Value of INR132.2 billion.

The company had 58,147 individual agents as at June 30, 2017, which comprise 6.1% of the all private agents in the Indian life insurance industry. It has a pan-India presence, comprising 414 branches and spokes across India as at June 30, 2017, supported by a workforce of 15,406 full-time employees. Its number of major bancassurance partners grew from 31 as at March 31, 2015 to 120 as at June 30, 2017.

Promoters of HDFC Standard Life Insurance - Housing Development Finance Corporation Limited, Standard Life (Mauritius Holdings) 2006 Limited, and Standard Life Aberdeen Plc

HDFC Standard Life Insurance IPO details
Subscription Dates7 - 9 November 2017
Price BandINR275 - 290 per share
Fresh issueNil
Offer For Sale299,827,818 shares (INR8,245.26 - 8,695 crore)
Total IPO size299,827,818 shares (INR8,245.26 - 8,695 crore)
Minimum bid (lot size)50 shares
Face Value INR10 per share
Retail Allocation35%
Listing OnNSE, BSE
HDFC Standard Life's financial performance (in INR crore)
FY2013FY2014FY2015FY2016FY2017Q1 FY2018
Premium earned14,016.317,290.727,090.618,066.530,554.46,487.4
Profit after tax447.7725.3785.5818.4892.1316.4
EPS (INR)2.243.643.934.104.441.57

HDFC Life Contact Details

HDFC Standard Life Insurance Company
12th, 13th, and 14th Floor, Lodha Excelus
Apollo Mills Compound, N.M. Joshi Marg
Mahalaxmi, Mumbai – 400 011

Phone: +91 22 6751 6666
Fax: 
+91 22 6751 6861
Email:
[email protected]
Website: www.hdfclife.com

Registrar of HDFC Life IPO

Karvy Computershare Private Limited
Karvy Selenium Tower B, Plot 31-32,
Gachibowli, Nanakramguda,
Hyderabad – 500 032, Telangana

Phone: +91 40 6716 2222 
Fax:
 +91 40 2343 1551 
Email:
 [email protected]
Website: www.karvycomputershare.com

Valuation of HDFC Standard Life (Based on latest FY)

Earnings Per Share (EPS): INR4.4

Price/Earnings (P/E) ratio: 62.50 - 65.91

Return on Net Worth (RONW): 25.6%

Net Asset Value (NAV): INR19.1 per share

HDFC Standard Life IPO Subscription Details

Category

Shares offered

Subscription (no. of times, at 5 PM)
Day 1Day 2

Day 3

QIB

53,379,158

1.39

 3.69 16.59
NII

40,034,328

0.22

 0.49 2.29
Retail

93,413,431

0.15

 0.36 0.84
Employees

2,949,520

0.45

 0.77 1.20
HDFC Shareholders 29,982,781 0.07 0.15 0.29
Total

219,759,218

0.45

 1.19 4.86

HDFC Standard Life IPO Allotment Status

HDFC Standard Life IPO allotment status is now available on Karvy Computershare’s website. Click on this link to get allotment status.

LISTING PERFORMANCE OF HDFC Standard Life

IPO Opening Date: 7 November 2017

IPO Closing Date: 9 November 2017

Finalisation of Basis of Allotment: 14 November 2017

Initiation of refunds: 15 November 2017

Transfer of shares to demat accounts: 16 November 2017

Listing Date: 17 November 2017

Listing Price on NSE: INR310 per share (up 6.9% from IPO price)

Closing Price on NSE: INR343.9 per share (up 18.6% from IPO price)

29 COMMENTS

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  3. Very good IPO For Small Cap Investors. This Is Reasonable Price compare than Other Insurance Company’s. HDFC is A good Standard and Good Ethics Banking Service. There is No doubt for Investing in HDFC Life IPO. It Will be Gold Egg In Stock Market.

    • Yes u are right. If any IPO which we believe that not give us listing gain then no need to apply for IPO. Wait for listing and when available for discount rate in secondary market then purchase.

    • IN SECONDARY MKT PPL WONT BUY BUT IF ALLOTED IN IPO WILL HOLD FOR LONG TERM. THAT IS THE REASON. IF YOU HAVE MONEY YOU WILL NOT INVEST IN SCRIPTS WHICH ARE LISTING BELOW IPO PRICE & THIS IS THE MENTALITY

  4. Mcap/embedded-value metric used for valuing life insurance company. if =2.5, then fully priced. for hdfc life, metric=4.15! that means highly overpriced.

    the justification being told by hdfc for steep valuation is that embedded value is growing very fast.

  5. 1. By compare similar listed peer group valuation (on such high priced (on both P/E & PBV basis) and thin margin basis) it demanding very High priced (at 65.61 P/E at EPS FY-17 4.42 and P/E 69.87 at avg. 3 yr. EPS of 4.15). Where other listed company ICICI Pru Life is available at Just Half P/E valuations of 33.
    2. By compare with Price to Book value HDFC demanding highest PBV of 15 while ICICI Pru life is available at PBV of 9 only.
    3. One thing also be noted that ICICI Pru life is First IPO in life insurance space and comes at 29 P/E but street and investor not give thumbs up to ICICI pru and it listed below offer price (and HDFC demanding 65 P/E). Than what is thought process of these days IPO’s, companies demanding very High P/E of 40-100. I think companies think about us (retail investor) are fools/idiot. Times came to reply these companies very hard in their own language by not subscribing single application in retail category. One thing is very clear that retail investor is now very smart and time is comes for companies to rethink about pricing.

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