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India's National Insurance pushes back IPO to next fiscal year

National Insurance Co. Ltd. has pushed its IPO to the next financial year beginning April 1, amid lukewarm investor demand for listings by other Indian government-owned insurers, India's Business Standard reported Dec. 28.

The Indian government is preoccupied by preparations for the budget, said K. Sanath Kumar, chairman of the state-owned insurer.

The proposed sale of a 15% stake in National Insurance was reported to fetch up to 37.50 billion Indian rupees, valuing the company at 250 billion rupees.

As many Indian insurers went public in 2017, the government also wants more of gap until the next IPO of a public-sector insurance company, sources at National Insurance told the publication.

Large offering sizes and high prices in other IPOs by public-sector insurance companies led to poor investor response, with the high offering prices leading to small investors seeing little gain on listing, analysts told the Business Standard.

Government-owned insurers have also been reporting higher combined ratios compared to privately run ones. The combined ratio, a key measure of financial health for insurance companies, is the proportion of claims-related losses and costs over earned premiums.

As of Dec. 27, US$1 was equivalent to 64.16 Indian rupees.