South African financial services group Sanlam is ready to increase stake in its Indian joint venture Shriram Life Insurance from 26 per cent to 49 per cent.

“They have already expressed commitment to increase their stake and are awaiting for the things to be in place entirely,” Major Kumar Jain, Chief Executive Officer of Shriram Life Insurance, told BusinessLine here on Tuesday.

Sanlam Life Insurance Ltd is one of the largest providers of life insurance in South Africa with 3.2 million individual policies under administration. It has a significant presence across South Africa, the UK and Namibia. It has a 26 per cent stake in the holding company, Shriram Capital.

The company, however, is well-capitalised and is not in need for fresh capital now.

“We might dilute our stake to accommodate a higher stake for Sanlam. Final modalities are to be worked out,” Jain said. Incorporated in 2005, Shriram Life, which is part of the ₹80,000 crore Chennai-based Shriram Group, now has 414 branches of which over 160 are in South India with a sum assured of ₹6,500 crore.

“We are a pan-India company with a good branch network in north India, which accounts for 40 per cent of our business,” Jain said.

The Government has recently issued an ordinance raising the cap of foreign direct investment in insurance from 26 per cent to 49 per cent, which is expected to be approved by Parliament during the ensuing Budget session.

The foreign partners of other insurance joint ventures might also increase their stakes.

UK-based Bupa Insurance has already expressed interest to up its holding in the Indian joint venture, Max Bupa Health Insurance, to 49 per cent.

In a recent interaction with BusinessLine , Insurance Regulatory and Development Authority of India Chairman TS Vijayan had said the industry might require investments to the tune of ₹60,000 crore in the next five years.

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