The Hindu Business Line : ICICI-Prudential expected to raise capital for growth

Speaking to newspersons here on Friday, the ICICI Prudential Managing Director, Ms Shikha Sharma, said, "Both ICICI and Prudential are committed to infuse capital." She, however, declined to specify any numbers saying that they were forward-looking statements.

Prudential Plc of the UK is a 26 per cent partner in the joint venture life insurance company.

Ms Sharma said the delay in amending the insurance statutes would not impact capitalisation. ICICI Prudential (ICICI-Pru) is currently capitalised at Rs 675 crore.

Asked whether the issue of an initial public offering was still open, she replied in the affirmative. Ms Sharma said, "An IPO is certainly a possibility, though not immediately."

Premium accretion during the April-August period of the current financial year was Rs 362 crore and the cumulative premium collected by ICICI-Pru since inception was Rs 2,200 crore.

ICICI has so far issued three lakh policies, Ms Sharma said for an assured sum of Rs 22,500 crore. This has given it a 25 per cent market share.

Most of the growth in policies, Ms Sharma said, came from unit-linked policies. At least 60 per cent of the total policies issued were unit-linked, she said. But in the first half of this year, at least 80 per cent of the policies were unit-linked. This was in line with international trends where the largest growth was recorded in unit-linked policies.

Even in unit-linked policies, Ms Sharma said most policyholders preferred balanced funds - where the asset allocation is 60 per cent debt and 40 per cent in equities. She said that bulk of the asset allocation was only in Government debt in the case of debt funds. In the case of equities, most investments were in highly liquid stocks.

Ms Sharma also admitted that that during the last few months after the yield spike in the debt markets, investors have migrated to unit-linked policies with balanced funds.

She said the fund management for the insurance arm was independent of ICICI's asset management company, in line with guidelines of the insurance regulator's guidelines. The total investible corpus available with ICICI- Pru is currently in the region of Rs 2,200 crore.

Ms Sharma said that ICICI-Pru plans to introduce a mortgage-linked product in the coming months.

This is to take advantage of the housing loan portfolio growth of its parent.

ICICI-Pru is also targeting corporates for group cover schemes. Ms Sharma said some of the corporates have picked up group-linked covers for gratuity and group protection covers. For such covers, she said, the parent company supported its efforts.

Referring to pension-linked products, despite its late entry ICICI has managed to rope in 125 customers, which included some top-level corporates, she said.

Some of these corporates switched over from a defined benefit to a defined contribution based pension fund.

Ms Sharma said ICICI-Pru would aggressively pitch for managing the pensions of some of the Government departments and the State Governments, once the pension regulator's guidelines are in place.