Life insurer becomes first to go public

The board of Housing Development Finance Corp. Ltd (HDFC) has approved a proposal to sell shares of unit HDFC Standard Life Insurance Co. to the public for the first time.

“The plan is to do this divestment in the second part of the calendar year,” said Keki Mistry, vice-chairman and chief executive officer of mortgage financier HDFC, in a Reuters report.

The decision makes HDFC Standard Life the first insurer in India to start the process for an initial public offering (IPO).

In a regulatory filing, the company said the board meeting was held on April 18, 2016, and it approved selling up to a 10 percent stake in HDFC Life.

“The board approved taking steps to initiate the process for an IPO by way of offer for sale by the corporation, up to 10 percent of equity of HDFC Life,” the company said.

According to Mistry, HDFC has been looking to raise money through its life insurance venture for some time. “A board approval was needed to start the process, which we have now received,” Mistry said.

The issue is pending regulatory approval from the Securities and Exchanges Board of India (Sebi) and the Insurance Regulatory Development Authority of India (IRDAI).