Online insurance platform Policybazaar aims to go public in 2021 at a valuation north of $3.5 billion, potentially becoming the first of India’s mega start-ups to debut as its digital economy booms.

The start-up plans to secure about $250 million in a round of financing at a $2 billion-plus valuation before a September 2021 initial public offering, co-founder Yashish Dahiya told Bloomberg News. Policybazaar is now selecting two to three IPO lead underwriters from a roster that includes several Wall Street banks, said Dahiya, chief executive officer of Policybazaar parent ETech Aces Marketing and Consulting Pvt.

“We have global interest and will raise in the coming weeks,” Dahiya said from London, where he is currently based.

On the likes of Lemonade

Policybazaar, which counts SoftBank Group Corp’s Vision Fund, Tiger Global Management and Tencent Holdings Ltd among its largest backers, may become the first of India’s digital-era upstarts to go public. Like fellow unicorns Ola, Flipkart and Paytm, the fintech firm rode an upswell of internet and mobile use that spurred digital services across the world’s second-most populous nation. It may be hoping to replicate the spectacular coming-out party of another SoftBank-backed insurer, Lemonade Inc, which soared on its US debut last month.

Policybazaar intends to list in Mumbai but Dahiya said he’ll consider a dual listing if rules change. India is tweaking regulations to help companies list overseas. Many start-ups have incorporated in countries like Singapore and the US because of friendlier public listing rules (among other considerations), but India currently prohibits that for sensitive sectors like financial services. SoftBank and Singaporean state investment firm Temasek Holdings Pte each hold about a 15 per cent stake each in the start-up, while Tencent and Tiger Global have about 10 and 8 per cent, respectively.

Policybazaar is among a clutch of fintech start-ups seeking to upend the stranglehold of state- and bank-backed insurers in a tightly regulated financial services segment. Like rivals Amazon.com Inc. and Alibaba Group Holding Ltd-backed Paytm, it’s trying to tap a large population of under-insured — or non-insured — Indians. Though the government has recently pushed health insurance plans to the less privileged, overall insurance penetration hovered at less than 4 per cent in 2017, according to the government’s India Brand Equity Foundation.

Yet as economic uncertainties rise, a young insurable population, growing middle class and rising awareness about the need for retirement planning is buoying the market. The industry should touch $280 billion in revenues this year and expand by 14 to 15 per cent annually over the next three to five years, according to the foundation.

Policybazaar itself helps sell about a million policies a month. The aggregator lets users compare life, health, auto, travel and property policies from 40 insurers on its website without going through conventional agents, who sell based on incentives. Policybazaar’s own customer service reps help users settle claims, redeem paybacks and amend policies. Sister unit Paisabazaar facilitates loans, credit cards and sells mutual funds, tapping an adjacent Indian digital payments market forecast by Credit Suisse to cross $1 trillion by 2022.

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