Reliance General Insurance Plans To File Fresh IPO Papers With SEBI

Reliance General Insurance, part of Anil Ambani-led Reliance, plans to file fresh papers with the Securities and Exchange Board of India to float an initial share sale as the regulatory approval for it is set to lapse this month, merchant banking sources said.

The company failed to tap primary markets as lack of investors’ appetite for the initial public offering, and volatile equity market conditions forced the insurer to postpone its plans.

SEBI’s approval for IPOs is valid for one year, and it will expire on Nov. 29 in the case of Reliance General Insurance Company, according to data available with the market regulator.

According to merchant banking sources, the company is very keen on coming out with its IPO and will refile the draft red herring prospectus with SEBI very soon.

“The timing of the company’s IPO will depend on market conditions,” they said.

Reliance General Insurance spokesperson, however, declined to comment on the company’s IPO status.

The firm had earlier filed its draft red herring prospectus in October last year for which it received SEBI’s approval in November 2017.

The IPO comprised fresh issue of little over 1.67 crore shares by the company and an offer for sale by Reliance Capital of 5.03 crore shares.

The firm was planning to use the proceeds towards augmenting the solvency margin and consequently increasing the solvency ratio. Besides, the money was to be used to meet future capital requirements.

Apart from Reliance General Insurance, Seven Islands Shipping’s IPO approval will lapse on Nov. 10, and that of CMS Info Systems will expire Nov. 29, according to SEBI’s data.

According to SEBI’s regulations, a firm gets one year to hit the primary market after receiving approval from the regulator. In case a firm fails to do so during this period, it has to refile the prospectus with SEBI seeking fresh clearance.