Policybazaar IPO: Anchor investors bet big, but here is what matters for retail bets

Policybazaar and Paisabazaar owner PB Fintech is hoping for a crackling initial public offer ahead of Diwali. The IPO price band has been set at Rs 940 to 980 and the issue is open from November 1-3. Here are the things you must know before investing:

What's exciting about this IPO?

PB Fintech offers a pie of India's largest online platform for insurance (Policybazaar) and lending products (Paisabazaar). Holds 65.3 percent market share in all digital insurance sales in India by number of policies sold.

Marketshare is great but does it make profit?

The company posted a consolidated loss of Rs 150.24 crore for the financial year FY21, but the bright side is that is was much lower compared to a loss of Rs 304.03 crore the year before. Revenue however have seen a big jump to Rs 886.66 crore from Rs 771.3 crore over the last two years.

What are my risks?

Online insurance or fintech as a whole has become a highly competitive market in India with a host of startups establishing themselves as serious competition like recent unicorn Acko and Virat Kohli backed Digit Insurance. Analysts fear with competition rising and a history of losses, the company may not be able to sustain growth in a cost effective manner as it has also warned of the same in it's DRHP.

Gauging sentiment vs grey market premium

Policybazaar operator PB Fintech is available at Rs 1,100-1,150 per share in the grey market, a premium of Rs 120-170 or 12-17 percent over upper price band of Rs 980.

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