IPO Approved: Prabhu Life Insurance to issue 60 lakh units shares to general public

Prabhu Life Insurance has received permission from the Securities Board of Nepal to issue an IPO. The board has allowed the company to issue 60 lakh shares in an IPO. Prabhu Life Insurance had submitted its application on Ashwin 21.

Beema Samiti has already directed life insurance companies to maintain a minimum paid-up capital of Rs 2 Arba. Prabhu Life Insurance's existing paid-up capital is Rs. 1.4 Arba. It will fulfill the capital requirement after the IPO issue.

Siddhartha Capital has already been appointed the issue manager of the IPO issue. However, the date of the IPO issue isn't announced yet.

ICRA Nepal has assigned the issuer rating of [ICRANP-IR] BB+ (pronounced ICRA NP Issuer Rating Double B plus) to Prabhu Life Insurance Limited (PLIL). Issuers with this rating are considered to have a moderate risk of default regarding timely servicing of financial obligations. ICRA Nepal has also assigned a grading of [ICRANP] IPO Grade 4, indicating below-average fundamentals, to the proposed initial public offering (IPO) of Rs. 60 crores.

Prabhu Life Insurance Limited is a new player in the life insurance industry of Nepal. Along with nine other LICs, the company was licensed by the Insurance Board in 2016/17, taking the total number of life insurers to 19 from nine. As of mid-July 2020, the company has been in operations with 90 outlets and 10,463 individual agents, and 25 corporate agents spread across the nation for procuring new business and extending after-sales services.

The company posted a net profit of Rs. 4.44 crores in the fourth quarter of the fiscal year 2076/77.