By Devidutta Tripathy
MUMBAI (Reuters) - India's ICICI Prudential Life Insurance Co Ltd saw strong demand on Wednesday for its up to $904 million initial public offering, the nation's biggest for six years, with investors putting in orders for more than 10 times the number of shares on offer.
The IPO, the first by an Indian insurer, received bids for about 1.38 billion shares, or 10.4 times the 132.4 million shares being sold to the public, according to stock exchange data as of 1215 GMT. https://bsmedia.business-standard.combit.ly/2d1x4Vp
India's IPO market has been on a roll, with first time share sales so far this year, excluding ICICI Pru Life's, amounting to $1.84 billion, 75 percent higher than a year earlier, according to Thomson Reuters data.
Strong demand for ICICI Pru Life stock follows successful listings by RBL Bank and Ujjivan Financial Services in recent months. It also bodes well for financial sector IPOs including PNB Housing Finance Ltd and Hinduja Leyland Finance Ltd expected in the coming months.
"Generally, there has been a tailwind for the financial services issues, especially the good quality ones," said Ajay Saraf, executive director at ICICI Securities, which was one of two lead banks on the ICICI Pru Life IPO.
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With generally lower insurance coverage than developed markets, India is seen as a bright spot for the industry. That growth potential has attracted many foreign insurers to forge joint ventures with local companies.
India this year raised the maximum foreign shareholding allowed in a local insurer to 49 percent.
Proceeds from the ICICI Pru Life IPO will go to its parent ICICI Bank, which is selling a 12.63 percent stake in the insurer in a price range of 300 rupees to 334 rupees per share. Some analysts have said the IPO is richly valued and would be a better bet for long-term investors.
Britain's Prudential Plc, which owns nearly 26 percent in ICICI Pru Life, is not selling shares in the IPO.
The IPO is the biggest since state-run Coal India Ltd's market debut in 2010.
ICICI Pru Life shares are due to start trading on or about Sept. 29.
Bank of America Merrill Lynch and ICICI Securities were the global coordinators and bookrunning lead managers of the IPO, along with eight other banks including CITIC CLSA, Deutsche, UBS and HSBC.
($1 = 67.0300 Indian rupees)
(Reporting by Devidutta Tripathy and Swati Bhat; Editing by Mark Potter)
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