Niva Bupa Health Insurance Company limited – about the company
Niva Bupa is India's largest Specialised Health Insurance (SHI) providers, which focuses on providing access to the best healthcare through health insurance products and services. The company had market share of 16.24%, 15.58%, and 13.87% from FY24 to FY22 based on retail health GDPI. The company has 14.73 million active lives insured as of March 31, 2024, with retail health products accounting for 68.47% of its overall GWP for Fiscal 2024. The retail health insurance segment is the most promising segment in the health insurance industry in India due to higher average premium per life, higher renewal rates, and lower Combined Ratios compared to group health insurance. The company sells products directly to customers through direct sales channels and intermediated distribution channels, with a diversified sourcing mix contributing to its overall GDPI.
Niva Bupa Health Insurance Company IPO objectives
Niva Bupa Health Insurance IPO issue has both fresh issue and offer for sale.
- The OFS consist of Rs. 2200 crores and the company will not get anything form OFS proceeds.
- Fresh issue consists of Rs. 800 crores. Out of total which Rs. 625 crores will be used for augmenting capital base to strengthen solvency levels and rest of the amount will be used for general corporate Purposes.
Niva Bupa Health Insurance Company IPO details:
| IPO Open Date | Not Announced |
| IPO Close Date | Not Announced |
| Basis of Allotment | Not Announced |
| Listing Date | Not Announced |
| Face Value | ₹10 per share |
| Price | Not Announced |
| Lot Size | Not Announced |
| Total Issue Size | Up to [●] Equity Shares |
| Aggregating up ₹30,000.00 million | |
| Fresh Issue | Up to [●] Equity Shares |
| Aggregating up to ₹8,000.00 million | |
| Offer For Sale | Up to [●] Equity Shares |
| Aggregating up to ₹22,000.00 million | |
| Issue Type | Book Built Issue IPO |
| Listing At | BSE & NSE |
| QIB Shares Offered | Not less than 75% of the Net Issue |
| Retail Shares Offered | Not more than 10% of the Net Issue |
| NII (HNI) Shares Offered | Not more than 15% of the Net Issue |
Niva Bupa Health Insurance Company IPO issue price & size
The RHP of Niva Bupa Health Insurance hasn’t been filed yet, so the important price range are unknown. As soon as the information is announced, same will be updated and the investors can bid between those price range on respective dates. The IPO has fresh issue of up to Rs. 800 crores and an OFS of Rs. 2200 crores.
Niva Bupa Health Insurance Company IPO launch date
The IPO of this company is launching on (Opening Date XXXX), hence the opening date for bidding is (Open Date) and the IPO is closing on (Closing Date). Investors can bid in this IPO between these days during the primary market hours.
Niva Bupa Health Insurance Company financial statement:
| Particulars | FY24 | FY23 | FY22 |
| Income | |||
| Premiums earned (Net) | 32112.49 | 26627.51 | 17525.09 |
| Profit/(Loss) on sale/
redemption of investment |
39.49 | 35.15 | 53.36 |
| Others | |||
| Contribution from shareholders
funds towards excess EOM |
2164.51 | 3641.61 | 2717.17 |
| Accretion/amortization of (premium)/
discount of investments |
60.21 | -0.89 | -40.31 |
| Interest, dividend and rent – (gross) | 1567.13 | 1309.35 | 859.92 |
| Total | 41943.83 | 32612.73 | 21115.23 |
| Expenses | |||
| Claims incurred (net) | 22495.41 | 14393.11 | 10886.25 |
| Commission (net) | 7481.82 | 1908.28 | 1204.19 |
| Operating Expenses related
to Insurance Business |
10086.34 | 11801.91 | 8567.36 |
| Total | 40063.57 | 28103.3 | 20657.8 |
| Operating profit/(loss) | 1880.26 | 3509.43 | 457.43 |
| Particulars | FY24 | FY23 | FY22 |
| Financial Metrics | |||
| GWP | 56075.74 | 40730.31 | 28099.71 |
| Premium on reinsurance ceded | 11866.23 | 8899.24 | 6523.43 |
| Net Premium | 44209.51 | 31831.07 | 21576.28 |
| Change in unexpired risk reserve | 6097.02 | 5203.56 | 4051.19 |
| Premiums earned (net) | 38112.49 | 26627.51 | 17525.09 |
| Claims incurred (net) | 22495.41 | 14393.11 | 10886.25 |
| Commission paid - Direct | 11943.86 | 4952.67 | 3364.96 |
| Commission (net) | 7481.82 | 1908.28 | 1204.19 |
| Commission on reinsurance ceded | 4462.04 | 3044.39 | 2160.77 |
| Operating expenses related
to insurance business |
10086.34 | 11801.91 | 8567.36 |
| Borrowings | 2500 | 2500 | 2500 |
| Reserves and surplus | 12820.22 | 3342.64 | 1254.02 |
| Operating profit/(loss) –
miscellaneous insurance |
1880.26 | 3509.43 | 457.43 |
| Profit/(loss) after tax | 818.52 | 125.4 | -1965.25 |
| Share capital | 16995.35 | 15106.78 | 14086.02 |
| Net current assets | -32163.9 | 23436.02 | 16953.42 |
| Debit balance in P&L account | 9319.67 | 10138.19 | 10263.59 |
| Sources of funds | 32326.21 | 20918.94 | 17820.1 |
| Assets Under Management | 54582.31 | 33660.95 | 24013.15 |
| Solvency Ratio | 2.55 | 1.67 | 1.72 |
| Retention Ratio | 78.84 | 78.15 | 76.78 |
| Claims Ratio | 59.02 | 54.05 | 62.12 |
| Expense Ratio | 39.74 | 43.07 | 45.29 |
| Combined Ratio | 98.76 | 97.13 | 107.41 |
| Expense of Management as % of GWP | 39.27 | 41.14 | 42.46 |
| Retail Health GWP | 38398.34 | 29697.4 | 21573.4 |
| Operating Metrics | |||
| Number of active lives insured
at the end of the Fiscal |
14.73 | 9.89 | 7.29 |
| Network Hospitals | 10460 | 10005 | 8562 |
| % of cashless claims through
Network Hospitals |
70.01 | 66.54 | 62.53 |
| Claim Settlement Ratio | 91.93 | 90.53 | 90.78 |
| Retail Health Market Share | 9.1 | 8.39 | 7.02 |
| Retail Health Accretion Market Share | 12.85 | 17.31 | 18.22 |
| Average ticket size per policy | 28797.48 | 26083.91 | 22183.45 |
| GWP per policy sold by agents | 25028.29 | 22895.36 | 20645.93 |
| GWP contribution of new retail health
indemnity policies with sum insured ≥ ₹ 1 million |
70.72 | 67.37 | 63.01 |
| Renewal rate for retail health
indemnity policies (by value) |
92.15 | 89.41 | 89.97 |
| Renewal rate for retail health
indemnity policies (by value) |
92.15 | 89.41 | 89.97 |
Promoters & shareholders of Niva Bupa
There are 2 corporate promoters of Niva Bupa Health Insurance, i.e.
- Bupa Singapore Holding Pte Ltd
- Bupa Investments Overseas Limited
Competitive strength
Focus on GWP growth, capital efficiency and profitability
As per Redseer Report, the company is the third largest and second fastest growing insurance company in India based on overall health GDPI in Fiscal 2024. The company has narrowed the gap in scale from larger competitors and widened the gap from smaller competitors in terms of retail health GDPI.
The company's focus on higher LTV and higher margin products in the retail health line of business resulted in a contribution of 70.72% of new retail health indemnity policies with sum insured of over Rs. 10 lakh for Fiscal 2024. The average ticket size of policies sold increased by 29%, from Rs. 22,186 in FY22 to Rs. 28,797 in FY24.
Diverse products offering
The company offers a range of health insurance products catering to all stages of the customer lifecycle, identifying customer groups based on age, income, and health status. Key products include "Reassure," which caters to upper class and wellness-focused customers, and "Aspire," targeting Millennials and Generation Z.
The company has developed a customer Lifetime Value (LTV)-based approach to new product creation, leveraging data analytics to determine LTV based on customer profile, claims experience, loss ratio assumptions, inflation, acquisition cost, and risk perception. This approach has enabled the company to innovate with new products targeted at specific customer groups and map customer groups via distribution channels, achieving favorable underwriting outcomes.
Strong promoter
Niva Bupa Health Insurance prompter is a member of Bupa group, which gives them access to its international healthcare experience. Bupa’s global health insurance and healthcare experience has had a meaningful influence and impact on company in multiple areas, including product innovation, technical support and actuarial insights and helps in adapting to a changing business conditions.
Multi-Channel Distribution
The company has adopted a multi-pronged distribution strategy which includes direct sales, online sales, and through distributors. The company's diversified channel mix includes corporate agents contributing 27.25%, individual agents contributing 32.07% and broker channels contributing 27.04% to GDPI for Fiscal 2024. The company also partners with 15 web aggregators to distribute its products.
The company's individual agency network has grown to 143,074 agents as of March 31, 2024, with the highest average ticket size per policy sold through individual agents among SAHI peers. The company supports its distribution channel through a physical branch network of 210 branches and an e-agency model, allowing remote onboarding and training of individual agents.
Risk factors
Concentration of segment
The company's pricing strategy is based on assumptions about medical expenses, age, and health conditions, but is subject to factors beyond their control. The company focuses on health insurance, with a total gross written premium of 56,075.74 for the FY24. The growth of the health insurance sector, particularly retail health, is key to the company's performance and profitability. The company targets Tier I cities but because of aggressive completion, adopts a selective strategy, focusing primarily on SMEs, to better price risks and access customer pool data.
Break-up of premium from direct business written
| Particulars | FY24 | FY23 | FY22 |
| Premium from direct business written | |||
| Health | 54944.28 | 39873.59 | 27490.35 |
| Personal Accident (B) | 926.76 | 800.41 | 607.57 |
| Travel | 204.7 | 56.31 | 1.79 |
| Total Gross Written Premium or GWP | 56075.74 | 40730.31 | 28099.71 |
Reliance on distribution channel
The company has a multi-channel distribution network, relying on intermediary channels such as individual agents, corporate agents, brokers, insurance marketing firms, POSPs, and web aggregators.
The majority of their GWP generated from corporate agents is derived from a limited number of banks and other corporate agents. The company is dependent on its existing relationships with its distributors, particularly its corporate agents.
| GWP(2) by Distribution Channels | ||||||
| Fiscal Year ended March 31, | ||||||
| 2024 | 2023 | 2022 | ||||
| (₹ in millions) | (% of total GWP) | (₹ in millions) | (% of total GWP) | (₹ in millions) | (% of total GWP) | |
| Direct Sales | 7329.77 | 13.07% | 6388.06 | 15.48% | 5276 | 18.78% |
| Officers / Employees | 7239.35 | 12.91% | 6336.65 | 15.56% | 5112.17 | 18.19% |
| Online (through Company website | 90.41 | 0.16% | 51.41 | 0.13% | 164.62 | 0.59% |
| Individual Agents | 17985.16 | 32.07% | 14670.46 | 36.02% | 10678.63 | 37.29% |
| Corporate Agents | 15281 | 27.25% | 10528.65 | 25.85% | 7704.04 | 27.42% |
| Banks | 10987.57 | 19.59% | 7146.95 | 17.55% | 5224.27 | 18.59% |
| Others | 4293.43 | 7.66% | 3381.7 | 8.30% | 2479.76 | 8.80% |
| Brokers | 15164.94 | 27.04% | 8865.71 | 21.77% | 3754.07 | 13.60% |
| Insurance Marketing Firms | 137.63 | 0.25% | 93.66 | 0.23% | 54.76 | 0.19% |
| Point of Sales Persons | 116.39 | 0.21% | 143.09 | 0.35% | 62.69 | 0.22% |
| Web Aggregators | 60.86 | 0.11% | 40.48 | 0.10% | 768.73 | 2.74% |
| Total GWP | 56075.74 | 100% | 40730.31 | 100% | 28099.71 | 100% |
NIVA BUPA HEALTH INSURANCE IPO Grey Market Premium
Grey market premium is the premium quoted over the IPO issue price. GMP shows that investors are ready to pay above the upper band of the IPO issue price. GMP is determined in the grey market as per the demand and supply of the shares in the primary market. A grey market is that unofficial ecosystem of unlisted companies' stocks that start trading even before the launch of the IPO to the date of its listing.
Also Read: What is Grey Market Premium in IPO: How is GMP Calculated & Reliable
However, GMP is not a reliable factor, as it keeps fluctuating as per the demand and supply of shares in the primary market. There are numerous factors that affect the stock market in India and individual stock prices of different companies that are already listed and trading in the secondary market. However, for an IPO-bounded company, you can consider the GMP as the speculative listing price of the share
According to various online sources, the Grey Market Premium or GMP of the NIVA BUPA HEALTH INSURANCE is trading around Rs XX in the grey market. It means shares are trading at the upper band issue price of Rs XX with a premium in the grey market and may list around the same price.
How to Apply for NIVA BUPA HEALTH INSURANCE IPO?
To apply in NIVA BUPA HEALTH INSURANCE IPO you need to open demat account to hold your allotted shares and a trading account to sell or buy the shares into the secondary market. And not only applying in the IPO, but while buying or selling the shares in the stock market you also need both these types of accounts. Hence, you can apply here at Moneysukh to open a trading and demat account at the lowest brokerage.
Also Read: Features of Best Demat Account with Lowest Brokerage Charges in India
Steps to Apply for NIVA BUPA HEALTH INSURANCE IPO:
Step 1: When NIVA BUPA HEALTH INSURANCE IPO opens you can bid online.
Step 2: Just go to trade.moneysukh.com and log in with your User ID & password.
Step 3: Now look for the IPO section and click on the NIVA BUPA HEALTH INSURANCE IPO.
Step 4: Here you need to fill in the required details like price, quantity, and so on.
Note: At the time of applying for the IPO, make sure to bid at the cutoff price and then submit your application.
Step 5: Now make the required payment and then submit your IPO application successfully.
How to Check NIVA BUPA HEALTH INSURANCE IPO Allotment Status?
Checking the allotment status online is very easy if you have the PAN details and IPO application number. But checking the details of the IPO allotment is possible only when the basis of allotment is arrived. In the case of NIVA BUPA HEALTH INSURANCE IPO, you can also check the allotment status through various online sources.
Also Read: How to check IPO allotment status on NSE, BSE through Moneysukh
And the basis of the allotment is highly dependent on the oversubscription of the IPO. If the IPO is oversubscribed by many folds, then for the investors who applied through the retail category or HNI category, the chances of getting the allotment become very low. Here while applying to such over-demanding IPOs you can follow some tips to improve your chances of getting the allotment in IPO.
Also Read: How to Increase the Chances of IPO Allotment
And when due to oversubscription of IPOs, you don’t get any allotment of shares, then your money will be refunded back into your bank account or fun will be unblocked if you applied through ASBA. However, despite the oversubscribed IPO, if get the allotment then the allocated shares will be transferred into your demat account any time before the date of listing. That you can sell in the secondary market after listing or keep from the long-term investment point of view.
