SBI General Insurance was started as a joint venture between the State Bank of India (SBI) and Insurance Australia Group (IAG). But in 2019, IAG exited fully in the company. It offers a range of general insurance products in India, including health, motor, home, travel, and personal accident insurance Ever since SBI General Insurance establishment in 2009, the growth has been exponential in various aspects. They have expanded their presence from 17 branches in 2011 to over 139 branches pan-India. Till date, they have served over 10 crore customers. They have been awarded ‘Insurer of the Year’ in the non-life category at FICCI Insurance Industry Awards, for two consecutive years in 2020 & 2021. In 2022, recognized as the 'Best General Insurance Company of the Year' at the 'Third Emerging Asia Insurance Awards' organized by the 'Indian Chamber of Commerce.
They have a robust multi-distribution model encompassing Bancassurance, Agency, Broking, Retail Direct Channels and Digital tie-ups. The widespread network of distributors like 22000 plus SBI branches, Agents, other financial alliances, OEMs, and multiple digital partners enable us to extend the reach to the pocketed remote areas of India. They offer a bouquet of products spread across various lines of businesses that cater to customers across all segments like Retail, Corporate, SME and Rural, ensuring accessibility via i.e., digital as well as physical modes.
SBI General Insurance reported a 11% growth in Gross Written Premium (GWP) in FY 2021-22 and the GWP stood at INR 9260 crore. With the increasing need of health insurance, we have a very channelized strategy for health insurance business, which has reflected in 50% growth in health insurance GWP for the FY2021-22.
With its headquarters in Mumbai, SBI General Insurance has a pan-India presence through a network of over 23,000 branches of State Bank of India and its associated banks. The company has a strong focus on customer-centricity and aims to provide innovative, affordable and accessible insurance solutions to individuals, businesses, and communities across the country. SBI General Insurance has won several awards and recognitions for its services, including the 'General Insurer of the Year' award at the Indian Insurance Awards in 2020. The company has a strong financial backing and is known for its quick and hassle-free claims settlement process.
Key events in the history of SBI General Insurance Unlisted Shares
2009: SBI and IAG sign a joint venture agreement to establish SBI General Insurance.
2010: SBI General Insurance begins its operations with a focus on personal and commercial insurance products.
2012: The company expands its product portfolio to include health insurance and travel insurance.
2013: SBI General Insurance launches its group health insurance product for corporates.
2014: The company introduces its crop insurance product for farmers.
2015: SBI General Insurance crosses the milestone of 1 million policies.
2016: The company launches its cyber insurance product for individuals and businesses.
2017: SBI General Insurance introduces its title insurance product for the real estate sector.
2018: The company launches its first-ever TV advertising campaign.
2019: SBI General Insurance introduces its home insurance product for homeowners and renters.
2020: The company wins the 'General Insurer of the Year' award at the Indian Insurance Awards
2021: SBI General Insurance crosses the milestone of 10 million policies.
In September of 2018, the business parted ways with 4% of its ownership in exchange for 4.82 billion (US$60 million) crore to Axis Asset Management Company and Premji Invest. IAG sold its entire stakes through the sale of its whole 26 percent stake in October of 2019.
Out of this total, 16.01 percent of the stock was acquired by Napean Opportunities LLP, which is a subsidiary of Premji Invest. Warburg Pincus acquired the remaining 9.99 percent of the stake. In the same year, the company announced a Bancassurance tie-Up with Karnataka Gramin Bank and formed a partnership with PolicyBazaar to sell travel insurance to people who were going to be travelling outside of India.
In 2019, Insurance Australia Group (IAG) has sold its entire 26 percent stake in SBI General to Premji Invest and Warburg Pincus for approximately ₹₹3,200 crore, valuing the company at ₹12,800 crore. Premji Invest (Premji) has acquired 16.01 per cent and Warburg Pincus Group 9.99 per cent in the company. In 2019, IAG was looking to focus on its core territories of Australia and New Zealand, and has exited other markets in emerging Asia.
In 2019, IAG has sold its entire stakes in the company at ~12500 Crores and at that time GDP (Gross Direct Premium ) of SBI General Insurance was ~4800 Crores, So, deal was done at Mcap/GDP of 2.6x.
SBI General Insurance underwrote gross direct premiums totaling Rs. 9,166 crore during the fiscal year 2022, which indicates an annual growth rate of 10.9% over the previous year in comparison to an industry growth rate of 11.03%. SBI General Insurance’s health portfolio, which expanded at a rate of 48% and accounted for approximately 20% of the company's overall premium portfolio, was the key driver for growth.
A growth rate of 17% was seen throughout the year in SBI General's Motor portfolio, which is their most important segment. SBI General Insurance has also adjusted its growth strategy in the crop segment, which had previously displayed significant losses. This was done in order to improve the segment's performance. As a direct consequence of this, the premium in this sector had a fall of 3% over the course of the fiscal 2022 year, and its proportion of the whole portfolio fell from 28% to 24%.
The significant increase in Covid-19 claims filed during the fiscal year 2022 had an effect on the underwriting result. In the current fiscal year (2022), the claims ratio was 86.3%, compared to 74.1% in the previous fiscal year (2021), and less than 5% of the claims in the current fiscal year were against Covid-19 losses.
As a direct consequence of this, the combined ratio for the company's fiscal year 2022 was significantly higher than its typical level, coming in at 113.7%. The performance for Q1 2023, on the other hand, has picked up, as seen by a claims ratio of 68.8% and a combined ratio of 99.5%. This is due to the progressive decline in the number of Covid-19 occurrences.
1.SBI, the parent organisation provides major administrative, financial, and branding support to the subsidiary, which plays a crucial role in SBI's overall strategy. This is reflected in the bank's high involvement in the functioning of SBI General as well as in the representation of SBI's directors on the board of SBI General, including the chairman of SBI, who also serves as the chairman of SBI General's board.
2. As indicated by the fact that the company's net worth was stated to be 3,013 crore as of June 30, 2022, capitalization is still sufficient in respect to the company's nature and scale of activity. During the past three years, the cushion in solvency ratio has been comfortable, and the solvency ratio has remained over two times since that time. The reported solvency ratio was 1.94 times as of the 30th day of June, 2022. The corporation and its parent organisation, SBI, aspire to keep a solvency ratio of at least 1.7 times or higher when operating in a state of steady-state operation.
3. SBI General Insurance Unlisted Share has managed to keep a premium mix that is quite broad over the years, in contrast to the greater emphasis that the sector as a whole places on conventional segments such as vehicle and health insurance. In addition to more traditional business areas such as the motor (27%) and health (20%) industries, the company has also been concentrating on the fire (15%) and crop business (24%). The corporation makes an effort to keep its exposure to any one segment at or below thirty percent on a steady-state basis.
4. The performance of the company's underwriting department has improved more quickly than that of its competitors in the ten years that it has been in business. For the five years leading up to the fiscal year 2021, the business maintained a combined ratio of 93-97% of its total revenue, resulting in an underwriting surplus for each of these years. Its claims ratio for the period was 70-75%, which is on par with the majority of well-performing firms in the sector; nonetheless, the primary factor contributing to its strong underwriting performance is its low commission and expense ratio. Because SBI General is the exclusive insurance partner of SBI, it gets access to the footfall at SBI branches, which reduces the amount of money spent on sourcing. Because of this affiliation, SBI General is able to source business from SBI, which acts as its bancassurance partner, at commission rates that are more favourable than those offered by competitors. This is an additional significant benefit. This channel contributes up to thirty percent of the total revenue generated by the corporation.
1. Although underwriting has performed better than the industry average, it has made a relatively little contribution to the company's overall profit. As a result, much like the rest of the business, the company's profitability are largely based on income from investments. The net profit of Rs 131 crore for the fiscal year 2022 was made up of an underwriting deficit of Rs 622 crore due to Covid-19 losses and investment income of Rs 838 crore. Earnings during the first quarter of 2023 recovered thanks to better underwriting performance; net profit was Rs. 139 crore. A rise in combined ratio could limit underwriting performance over the medium term, which would have a brief but minimal effect on total profitability.
2. With its share rising to one-third of the total premium mix after 2017, compared to less than one-fifth for the entire industry, crop insurance has become a key business area for SBI General. This development has been fueled by SBI's extensive rural reach and presence and its affiliation with regional rural banks (RRBs). The corporation is hence subject to innate difficulties like natural disasters ruining harvest and erratic monsoon, which may result in high claim volumes. Nonetheless, 80% of the company's agricultural business is reinsured, which lessens the net impact. Due to an increase in the claims ratio from 135.3% to 135.6%, the combined ratio for this segment increased from 128.5% in fiscal 2018 to 151.4% in fiscal 2022. The spending ratio in the agricultural segment, in particular for the fiscal year 2022, was high at 15.8% compared to less than 10% in prior years.
Out of the 74% stake in the Company, SBI had in mid - 2018 divested 4% stake to PI Opportunities Fund - I (2.35%) and Axis New Opportunities - AIF-I (1.65%). Further, IAG, the erstwhile JV partner of 26%, exited in March 2020, thereby divesting its entire stake of 26% to Napean Opportunities LLP (16.01%) and Honey Wheat Investments Ltd (9.99%). Other shareholders in the company are;, Axis New Opportunities - AIF-I (1.27%) and Avendus Future Leaders Fund I &II (0.38%).
Valuation of SBI General Insurance Unlisted Share
As per media reports, AXIS AIF has sold 1.27% stakes in SBI General Insurance to IIFL for ~350 Crores on 12.01.2023. If you do the reverse calculation, the 100% stake value of SBI General Insurance would be ~27000 Crores. So, Mcap/GWP is = 2.91x based on GWP number upto 31.03.2022. The valuation will come down further if we take GWP number of Fy23.
Note: Check the Latest SBI General Insurance Unlisted Shares Price at UnlisteZone Android or iOS Mobile App.
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Find answers to common questions that you may have in your mind.
Please find below the procedure for buying SBI General Insurance Unlisted Shares at UnlistedZone.
Please find below the procedure for selling SBI General Insurance Unlisted Shares at UnlistedZone.
The lock-in period for SBI General Insurance Unlisted Shares varies depending on the category of investors:
This regulation was introduced by SEBI in August 2021. The rule change, which reduced the lock-in period from one year to six months, was aimed at encouraging more investments in startups that are preparing for public offerings or IPOs. This reduction in the lock-in period is seen as a significant step forward, and since its introduction, many Portfolio Management Services (PMS) have been advising their clients to invest in Pre-IPO shares to capitalize on the benefits of early-stage investments.
DIS, or Delivery Instruction Slip, is a tool used by investors to sell or transfer SBI General Insurance Unlisted Shares from their demat account to another. There are two types of DIS Methods:
1. Offline-DIS: This is a traditional, paper-based method for transferring shares. When using Offline-DIS, investors are required to fill out a DIS form and submit it to their broker. The necessary fields in the form include:
a. ISIN number of SBI General Insurance Unlisted Shares.
b. Name of SBI General Insurance Unlisted Shares.
c. Quantity of SBI General Insurance Unlisted Shares.
d. Consideration Amount.
e. Target DP ID and Client ID.
f. Annexure.
2. Online DIS: Some brokers offer the facility to transfer SBI General Insurance Unlisted Shares through an online DIS system. It's advisable to check with your broker if such a facility is available.
For instance, platforms like Angel Broking provide an Online-DIS feature. In this method, an investor simply needs to add a beneficiary and transfer SBI General Insurance Unlisted Shares by filling in details similar to those required in the Offline-DIS.
For a more comprehensive understanding of this process, you can refer to our detailed article: https://unlistedzone.com/how-do-i-sell-my-unlisted-shares/
In recent years, the unlisted share market has expanded significantly, leading to a reduction in the minimum investment amount. Previously, the typical investment ticket size ranged from 5-10 Lakhs, but in the current market scenario, it has decreased to between 35-50k. Therefore, through our UnlistedZone platform, if someone wishes to invest in SBI General Insurance Unlisted Shares, the minimum investment required would now be in the range of 35-50k
Yes, buying and selling unlisted shares in India is indeed 100% legal. This activity is regulated and governed under the guidelines provided by the Securities and Exchange Board of India (SEBI). Investors and traders must adhere to these regulations and guidelines to ensure compliance with legal and financial standards. It's important for participants in the unlisted share market to be aware of and understand these regulations to engage in transactions legally and securely
When you sell unlisted shares within a period of two years from the date of acquisition, any profit earned from the sale is classified as Short-term Capital Gain (STCG). This gain is then added to your total income for that financial year. The tax on this short-term capital gain is calculated based on your applicable individual income tax slab rates. Therefore, the rate at which you will pay tax on the STCG from unlisted shares depends on your total income, including this gain, and the tax slab it falls under as per the prevailing income tax laws in India. It's important for investors to consider these tax implications when engaging in transactions involving unlisted shares.
Long-term Capital Gains (LTCG) on unlisted shares in India refer to the profits earned from the sale of unlisted shares that have been held for more than two years. The key aspects of LTCG on unlisted shares include:
When shares initially bought in the unlisted market become listed, the taxation rules change significantly if these shares are sold through a stock exchange. Here's what investors need to know:
Transition to Listed Market Tax Rates:
Once unlisted shares are listed on the stock exchange and subsequently sold, the tax rates applicable to listed securities come into effect. This shift means that the favorable tax treatments for listed shares, as per the prevailing tax laws, will apply.
Taxation Based on Holding Period:
The crucial factor in determining the type of capital gains tax (Long-term or Short-term) is the holding period of the shares. Importantly, this period is calculated from the original purchase date when the shares were unlisted.
Long-term vs. Short-term Capital Gains: If the shares are sold after being held for more than one year from the date of purchase (including the period when they were unlisted), they are subject to Long-term Capital Gains (LTCG) tax.
Conversely, if sold within one year, Short-term Capital Gains (STCG) tax rates apply.
Significance for Investors: This information is vital for investors in the unlisted market, as it impacts their tax planning and decision-making process. Understanding these nuances ensures that investors can strategically plan the sale of their shares post-listing to optimize tax implications.
Advice for Investors: It's advisable for investors to keep a record of their purchase dates and monitor the listing dates closely. Additionally, staying updated with the latest tax regulations or consulting with a financial advisor is recommended for accurate tax calculations and compliance.
When you purchase SBI General Insurance Unlisted Shares through UnlistedZone, it's important to note that, as per SEBI regulations, these shares can only be transferred to a demat account.
There are two primary ways to check the credit of SBI General Insurance Unlisted Shares in your account:
1. Using NSDL or CDSL Applications:
Download the NSDL or CDSL application from the Google Play Store.
To determine whether your stock broker is registered with NSDL or CDSL, you can examine the format of your Demat Account number. The Demat Account number consists of 16 characters, combining the DP ID and Client ID.
DP ID is the unique identification number of the Broker, assigned by CDSL or NSDL.
Client ID is the unique identification number of the Client, representing their portfolio.
In CDSL, the Demat Account number is entirely numeric (e.g., 12345678 for DP ID and 91234567 for Client ID).
In NSDL, the first two characters are alphabetic, representing the country (e.g., 'IN' for India), followed by a 6-digit unique number for the Broker (DP ID) and an 8-digit Client ID (e.g., IN123456 for DP ID and 78912345 for Client ID).
2. Checking in Broker's Application:
The credit of SBI General Insurance Unlisted Shares can also be checked in your broker's application. However, it's important to note that it may take T+2 days for the shares to show up in the application after the transaction.
The SBI General Insurance Unlisted Shares are credited in the demat account on the same day as the transfer of funds into our company's bank account.
"The price of SBI General Insurance Unlisted Shares can be checked in two ways. First, you can join our Telegram channel, where we share the latest prices of all unlisted shares daily in the morning. Secondly, you can check price on our UnlistedZone platform to view historical graphs and prices of all shares in one place."
Investing in SBI General Insurance Unlisted Shares, like any investment, carries certain risks that should be carefully considered:
1. Liquidity Risk: Unlisted shares, by their nature, are not traded on public stock exchanges. This can result in lower liquidity compared to listed shares, meaning it might be more challenging to find buyers when you wish to sell your shares.
2. Price Volatility: The price of SBI General Insurance Unlisted Shares can be more volatile compared to listed shares. This is partly due to the lack of regular public trading and potentially limited information available about the company's financial health and performance.
3. Regulatory Risk: Unlisted shares are subject to different regulatory frameworks than listed shares. Any changes in regulations or compliance requirements can impact the value and tradeability of these shares.
4. Limited Information: There may be less publicly available information about unlisted companies. This can make it more difficult to assess the company's true value and potential for growth, increasing the risk of investment.
5. No Guarantee of Future Listing: Investing in SBI General Insurance Unlisted Shares with the expectation of future listing on a public exchange carries the risk that the listing may not occur. This can affect both the liquidity and potential value appreciation of the shares.
6. Company-Specific Risks: Each company has its own set of risks based on its industry, management, financial health, and market position. These risks can significantly impact the performance of your investment in SBI General Insurance Unlisted Shares.
UnlistedZone: Pioneering Excellence in India's Unlisted Share Market
UnlistedZone stands as India's fastest-growing and leading marketplace for buying and selling unlisted shares. Over the past 5 years, we have carved a niche in the financial market, website hit user inflows over a 2 million users on our platform since inception. This remarkable journey is underscored by the sheer volume of transactions facilitated through UnlistedZone, which has already surpassed the 300 Crore mark.
At the helm of our success are our esteemed co-founders, Mr. Umesh Paliwal and Dinesh Gupta. Their insights and expertise are regularly sought after by leading financial publications such as MoneyControl, Business Standard, and The Economic Times, particularly for their authoritative views on IPOs and the unlisted market. Our journey over these 5 years has not just been about numbers; it's been about building trust and reliability.
UnlistedZone has established a formidable reputation in the industry, earning the trust and confidence of our users. This trust is our cornerstone, ensuring that new investors can engage with us without the apprehensions of fraud that are often associated with unknown brokers in the market.
At UnlistedZone, we are committed to maintaining the highest standards of transparency and integrity, ensuring that your investment journey is not just profitable but also secure and trustworthy.
Valuation Methodology at UnlistedZone for SBI General Insurance Unlisted Shares
At UnlistedZone, we employ a meticulous and strategic approach to valuing SBI General Insurance Unlisted Shares, utilizing two primary methods: Benchmark Valuation Based on Latest Funding:
1. Our first step is to examine the most recent funding round for SBI General Insurance Unlisted Shares. This provides us with a benchmark valuation, offering a clear indication of the company's current market value as perceived by investors and industry experts. This method is particularly effective in capturing the latest market sentiment and financial health of the company.
2. Comparison with Listed Peers: In cases where there hasn't been recent funding for SBI General Insurance Unlisted Shares, we adopt a comparative approach. This involves identifying a business in the listed market that closely resembles SBI General Insurance Unlisted Shares in terms of industry, size, and business model. By comparing and contrasting the two, we can ascertain a fair valuation for SBI General Insurance Unlisted Shares, drawing on the market data and performance metrics of its listed counterpart.
Investor Advisory: As experts in the unlisted space, we at UnlistedZone emphasize the importance of thorough risk assessment to all our investors. It's crucial to evaluate all risk parameters carefully before investing in unlisted shares. This due diligence is key to making informed and strategic investment decisions in the dynamic and evolving unlisted market.
"At UnlistedZone, our approach to sourcing SBI General Insurance Unlisted Shares involves a strategic and direct method. Primarily, we acquire these shares from two key groups:
1. Employees of the Company: Often, employees of a company receive shares as part of their compensation or through employee stock option plans (ESOPs). Over time, some of these employees may decide to liquidate their holdings for various reasons, such as financial needs or portfolio diversification. We engage with these employees, providing them a platform to sell their shares.
2. Initial Investors: These are the early-stage investors or angel investors who provided capital to the company during its initial phases. As the company grows and evolves, these initial investors might look to sell part or all of their stake in the company. This could be for reasons like capitalizing on their investment, reallocating assets, or other strategic financial decisions.
By connecting with these groups, UnlistedZone ensures a reliable and consistent supply of SBI General Insurance Unlisted Shares for our clients. This method not only helps employees and initial investors in liquidating their assets but also provides our clients with access to shares that are not readily available in the public market. It's a win-win for both the sellers and buyers, facilitated efficiently through our platform."
"The Securities and Exchange Board of India (SEBI) does have a regulatory influence on the unlisted market, though it's not as comprehensive as its oversight of the listed markets.
Key aspects of SEBI's involvement in the unlisted space include:
1. Applicable Rules and Regulations: Certain SEBI regulations are indeed applicable to transactions in the unlisted market. This includes the mandatory lock-in period of 6 months, the requirement to pay stamp duty, and depository participant (DP) charges for every transaction. These measures are in place to ensure a certain level of standardization and protection in the unlisted market, similar to those in the listed markets.
2. Lack of Specific Regulation for Unlisted Brokers: As of now, SEBI does not have specific regulations for becoming an unlisted broker. This means that while certain SEBI rules apply to transactions within the unlisted market, the process of becoming a broker in this space is not directly regulated by SEBI. This lack of direct regulation highlights the importance of due diligence by investors when engaging with brokers in the unlisted market.
3. Investor Protection and Transparency: The regulations that do apply, such as the lock-in period and transaction charges, are designed to protect investors and add a layer of transparency to these transactions. They aim to mitigate some of the risks inherent in trading unlisted securities, which typically don't have the same level of public scrutiny and regulatory oversight as listed securities. In summary, while SEBI's regulatory framework does extend to certain aspects of the unlisted market, it does not comprehensively regulate all aspects of it, particularly concerning the accreditation of unlisted brokers. This underscores the need for investors to exercise caution and conduct thorough research when participating in the unlisted market."
"For comprehensive and up-to-date news and information about SBI General Insurance Unlisted Shares, we have several platforms to keep you informed. Our website is regularly updated with the latest insights and developments. For real-time updates and engaging discussions, you can join our Telegram channel. Additionally, follow us on Twitter for quick news bites and industry trends. And for more in-depth analysis and informative content, subscribe to our YouTube channel. These resources are designed to provide you with a well-rounded understanding of the unlisted market, ensuring you have access to all the information you need about SBI General Insurance Unlisted Shares."