New Delhi, Aug. 24
THE domestic life insurance sector will have a new player with the Bharti group entering into a joint venture with one of the world's largest insurers AXA. The company will commence business during the first half of 2006 after obtaining the regulatory approvals.
The joint venture is expected to have a capital base of about Rs 500 crore within the next 3-4 years.
Under the present laws, an insurance company has to have a minimum capital of Rs 100 crore. While Bharti will hold 74 per cent stake in the venture, AXA Asia Pacific Holdings Ltd will hold the remaining 26 per cent.
Mr Les Owen, Group Chief Executive, AXA Asia Pacific, said: "India is a huge market with more than 1.1 billion people. This coupled with a large middle class and increasing income levels will drive growth in the insurance market." Mr Owen said the life insurance venture is expected to become one of the top five players in the Indian market and would have a multi-channel distribution approach.
The company would also seek to leverage the telecom customer base of Bharti.
The two parties are also likely to explore the possibility of entering other segments of the financial markets, including pension and mutual funds, the Bharti Chairman, Mr Sunil Mittal, said at a press conference here today. AXA Asia Pacific, a unit of AXA SA, France, is listed on the Australian and New Zealand stock exchanges.
The Asia-Pacific arm has operations in Australia, New Zealand, Hong Kong, China, Indonesia, the Philippines, Thailand and Singapore.