Shares of Niva Bupa Health Insurance is set to make its debut at Dalal Street on Thursday, November 14. The standalone health insurance player is headed for a soft landing at the bourses, if one goes by the current signals from the grey market premium, where it has been a dormant player.
Ahead of listing, shares of Niva Bupa Health Insurance Company were commanding a grey market premium (GMP) premium of Rs 1, suggesting flat listing for the investors. However, there was almost no activity in the grey market for the majority of the IPO period for the issue.
Niva Bupa Health Insurance is a prominent player in India's health insurance sector and it is set to make its stock market debut. The current grey market premium suggests a subdued market sentiment, said Shivani Nyati, Head of Wealth at Swastika Investmart. It has demonstrated strong growth and a positive turnaround in recent years, she said.
"The IPO's pricing appears aggressive, which could impact its listing performance. While Niva Bupa's long-term prospects in the growing Indian health insurance market are promising, investors should exercise caution due to the current market conditions and the company's recent financial performance," she added. The IPO of Delhi-based Niva Bupa Health Insurance ran for bidding between November 7 and November 11. It had offered its shares in the price band of Rs 70-74 per share with a lot size of 200 shares. The company raised a total of Rs 2,200 crore via IPO, which included a fresh share sale of Rs 8000 crore and offer-for-sale (OFS) of up to 189,189,189 shares worth Rs 1,400 crore.
The issue was overall subscribed just 1.80 times. The allocation for the qualified institutional bidders (QIBs) was subscribed only 2.06 times The portion allocated for retail investors was subscribed 2.73 times. However, The portion for non-institutional investors (NIIs) remained undersubscribed with only 68 per cent bids.
Incorporated in 2008, Niva Bupa Health Insurance Company is a joint venture between the Bupa Group and Fettle Tone LLP that provides insurance in the health sector. It offers a holistic proposition by providing customers access to a comprehensive health ecosystem and service capabilities through its Niva Bupa Health mobile application and website.
Brokerages mostly had a positive view on the issue and suggested subscribing for a long term citing. ICICI Securities, Kotak Mahindra Capital, Morgan Stanley India, Axis Capital, HDFC Bank and Motilal Oswal Investment Advisors were the book running lead managers of the Niva Bupa Health Insurance IPO, while Kfin Technologies served as the registrar for the issue.