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Policybazaar shares end nearly 23% higher on market debut

Mumbai: Shares of PB Fintech Ltd., the parent company of Policybazaar and Paisabazaar, gained more than 20% over the IPO price on stock market debut, marking yet another stellar stock market debut for a new-age internet company in India.

The stock listed at 17.35% premium on the BSE and hit an intraday high of Rs 1,249.00, before paring some of the gains to end the day at Rs 1,202.90—22.74% higher than its issue price of Rs 980. That ascribed the insurtech firm a market capitalisation of Rs 54,070.33 crore. In comparison, the market cap of Zomato Ltd. and NykaaNSE 0.10 % parent FSN E-Commerce Ventures Ltd. had topped the Rs 1 lakh-crore mark within the first few hours of trading on their stock market debuts.

“We are lucky we got to solve a problem where we could educate people about the need for life insurance,” PB Fintech’s cofounder Yashish Dahiya said during the listing event at the National Stock Exchange in Mumbai on Monday. “We have a long way to go”.

NSE CEO Vikram Limaye welcomed the company at the national bourses. “The listing of PB Fintech propels the story of new-age tech companies,” he said. “Indian markets have accepted the models of these companies which cannot be evaluated in conventional ways.”

Analysts expect the PB Fintech stock to do well, going forward.

“The insurance industry as well as the online market is underpenetrated and the company has a strong market share,” Rajnath Yadav, senior research analyst at Choice Broking, told Reuters. “We are anticipating growth in the online insurance segment and the company is expected to benefit.”

Life insurance penetration among India’s population stood at 2.82% in 2019, compared with 2.15% in 2001, the latest annual report from the Insurance Regulatory and Development Authority (IRDAI) showed.

Launched in 2008 as a price-comparison site, Policybazaar started India’s first online insurance marketplace in 2011. In 2014, the parent company — PB Fintech — launched Paisabazaar as a credit comparison platform. The fintech startup turned unicorn in 2018 after a SoftBank-led funding round.

A turning point (of sorts) came in June this year when India’s insurance regulator granted Policybazaar an insurance broking licence. The company promptly filed its IPO papers.

The Nov. 1-3 issue was subscribed 16.59 times last week. The IPO, which opened on Nov. 1, comprised a fresh issue of stock worth Rs 3,750 crore and an offer for sale valued at Rs 1,960 crore. The SoftBank-backed firm had raised more than Rs 2,569 crore from 155 anchor investors on Oct. 29. The price band was set at Rs 940-980 per share.

The company will use the IPO proceeds to enhance visibility and awareness of brands, find new opportunities to expand consumer base—including offline presence, strategic investments, and acquisitions—and expand its presence outside India.

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