Founders of PolicyBazaar to Reduce the Number of Own Shares in the IPO by 85-90%

Alok Bansal and Yashish Dahiya, founders of PB Fintech, the parent company of PolicyBazaar, have substantially reduced the number of shares they are promoting via offer for sale (OFS) in their IPO set to open on 1 November 2021. Sources known to the matter mentioned that the elevated interest for tech IPOs and scope for further growth in its business along with probable valuation after the share sale is the reason behind this reduction of OFS by 85-90% by their actual value.

Here is more information about this topic.

PolicyBazaar Founders Reduce their OFS by Value – A Closer Look

As per the DRHP filed in August, the Chairman and CEO of PB Fintech, Yashish Dahiya, was earlier supposed to put forth his shares worth Rs. 250 crores in the IPO. However, according to the latest DRHP, he will now sell shares worth only Rs. 30 crores.

In the same way, Alok Bansal, who is also the director and CEO of the company, previously intended to put off his holding amount to Rs. 95 crores. He will now sell shares worth below Rs. 13 crores.

Further, according to the RHP, Bansal owns 1.45% in PB Fintech, and Dahiya has 4.27% in the company.

Additionally, the largest shareholder in the company, SoftBank, with a stake of more than 15%, will sell shares amounting to Rs. 1,875 crores.

According to sources conscious of the matter, the founders of PB Fintech are talking with their money about the company’s growth potential and its commitment after the IPO. Due to the bullishness of Indian tech IPOs and an increase of liquidity in the global markets, startups expect their valuation to go higher as they follow growth.

As per reports, anchor investment slot in PolicyBazaar has witnessed a 40 times demand regarding bids. Additionally, major insurance firms have also taken up stakes in this firm.

About PolicyBazaar IPO

PolicyBazaar IPO opens on 1 November 2021 with a price band of Rs. 940-980 per share. The company plans to raise Rs. 5,700 crores through this IPO, which will consist of an offer for sale of Rs. 1,960 crores and fresh shares amounting to Rs. 3,750 crores.

According to PolicyBazaar, it will utilise the proceeds for the following reasons:

• 1,500 crores to increase awareness and visibility of brands, such as PaisaBazaar and PolicyBazaar.
• 375 crores to expand its customer base
• 600 crores on strategic acquisitions and investments
• 375 crores to grow its global presence and for general corporate reasons

Bottom Line

PolicyBazaar is one of the top-tier tech startups planning to go public in 2021. As its DRHP mentions, FB Fintech narrowed its loss from Rs. 304 crores to Rs. 150 crores in FY2020. In addition, this startup obtained an insurance broking license from IRDA in June. This will help the company expand its offerings and set up a physical network.

Frequently Asked Questions

1. How much listing valuation is PolicyBazaar looking for?

PolicyBazaar is aiming for a listing valuation of $6.15 billion.

2. What is the closing date of PolicyBazaar IPO?

3 November 2021.

3. How much did PolicyBazaar raise from anchor investors?

The company raised as much as Rs. 2,569 from 155 anchor investors, including ICICI Prudential, HDFC Life, Bajaj Allianz Life, Max Life Insurance and SBI General Insurance.