ICICI Lombard IPO - Information Analysis

Note: This article has no recommendation to either buy or avoid this IPO. Instead, we have presented all the relevant information based on which you can make your own decision. One more note: As regular readers of our IPO analyses would have noticed, we do not approach insurance IPOs in the same format that we use for non-financial companies. The reason is that a large proportion of the questions are irrelevant to these companies. This is partly because of the tight nature of the regulatory environment they operate in, and partly due to the complex, long-term risks that they face. Investing in Indian insurance companies is still a novel activity, and there will likely be surprises ahead that neither analysts nor investors can predict at this point. ICICI Lombard is in the business of general insurance. Its operations commenced in FY 2002 as a joint venture between ICICI Bank and Fairfax Insurance, a Canadian company (through its affiliate Lombard). Before 2000, the general insurance business was controlled by four public sector general insurance companies. Since the entry of private players they have steadily lost their share but they still account for 58% per cent of the market. ICICI Lombard’s gross premiums grew at a CAGR of 14.18% from FY12 to FY17 compared to 14% for the industry. In 2017, it became the first private non-life insurer to cross Rs 10,000 crore in gross premium income received. The insurance market in terms of gross premium is Rs 1.28 lakh crore. India’s total insurance premiums stand at just 0