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April 30, 2025
Canara HSBC Life Insurance Company has submitted a Draft Red Herring Prospectus (DRHP) to the Securities and Exchange Board of India (SEBI) for an initial public offering (IPO). Current shareholders Canara Bank, HSBC Insurance (Asia-Pacific) Holdings, and Punjab National Bank (PNB) plan to sell their shares through an offer-for-sale (OFS) of up to 237.5 million equity shares.
Share Sale Details with Stakeholders
Canara Bank, holding a 51% stake, plans to sell up to 137.75 million shares. HSBC Insurance (Asia-Pacific) Holdings, with a 26% stake, aims to offload up to 4.75 million shares. PNB, which owns 23% of the business, intends to sell up to 95 million shares.
The company will not receive any proceeds from the IPO as the entire issue is an OFS.
Overview of the Company
Canara HSBC Life Insurance, established in 2007, is a joint venture between Canara Bank, HSBC Insurance (Asia-Pacific) Holdings, and PNB. Headquartered in Gurugram, Haryana, the company offers a range of life insurance products, including retirement solutions, savings plans, and term insurance.
For the fiscal year 2023–24, the company reported a profit after tax of ₹113 crore, marking a 24.3% increase year-over-year. As of March 31, 2024, it managed assets worth over ₹40,000 crore.
Market Situation and Prospects
The IPO comes during a volatile period in the Indian IPO market, with listings down about 15% compared to 2024. Nevertheless, Canara HSBC Life Insurance remains a strong player in the life insurance sector due to its solid financial performance and established market presence.
The equity shares will be listed on both the National Stock Exchange (NSE) and the Bombay Stock Exchange (BSE). The IPO is being managed by SBI Capital Markets, BNP Paribas, HSBC Securities & Capital Markets (India), JM Financial, and Motilal Oswal Investment Advisors.
This move aligns with Canara Bank’s strategy to enhance its capital adequacy and monetize its insurance joint venture. Public sector banks are increasingly divesting stakes in non-core businesses to focus on their core banking operations.
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