The national reinsurer, GIC Re, filed draft red herring prospectus (DRHP) for public listing with the capital markets regulator Sebi in Mumbai, a senior official from the company said. It forms part of the government's plans to list four state-owned non-life insurers and the national reinsurer.
New India Assurance has already started the process for its forthcoming IPO, whereas National Insurance Company has hinted that it will come up with its IPO by the fiscal-end.
"We have filed DHRP for the company's forthcoming IPO with Sebi today," an official of the company told reporters.
"The issue size of the forthcoming IPO of GIC Re is likely to be at around USD 1 billion," he added.
The government will be selling 107.5 million shares, whereas GIC Re itself is likely to sell 17.2 million shares through the IPO. Thus a total of 124.7 million shares of the reinsurer would be sold through the share sale offer, constituting 14.22 per cent of the company's post issue share capital, as per the filing of the company.
Axis Capital, Citi, Deutsche Bank, HSBC and Kotak are the merchant bankers for the IPO. GIC Re is expected to hit the market by mid-October.
The company registered a profit after tax of Rs 3,127 crore in fiscal 2017, an increase of 9.8 per cent over the previous year.
The net worth of the company stood at Rs 47,983 crore.
"I would like to say that IPO is a welcome step and it shows the commitment of government to reforms. Having said that, we have kick-started the process of IPO and have appointed merchant bankers and legal counsels. Apart from that, I can't offer any more comments on the issues as we are in process of IPO," Alice Vaidyan, chairman and managing director at GIC Re had said earlier.
"We are waiting for clearance from the government as to what will be the initial tranche, but it will be disinvestment of 25 per cent over three years," Vaidyan had added.