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PB Fintech to invest Rs 1000 crore in Policybazaar and Paisabazaar, shares price up 5%

PB Fintech’s board has approved an additional investment of up to Rs 700 crore in one or more tranches in its wholly-owned subsidiary firm – Policybazaar Insurance Brokers Ltd., during the fiscal years 2021-22 and 2022-23. Furthermore, the board has also approved an investment of up to Rs 299 crore in Paisabazaar Marketing and Consulting.

Policybazaar logo on laptop screen

Illustration: TechStory × Freepik (Raw Pixel)

The announcement raised PB Fintech’s shares price by 5 percent in Friday’s trading session. The company’s counter reached a high of Rs 974.25, up from Rs 927.85 at the previous close on the BSE. The company said in a regulatory filing that 45,37,205 equity shares of Rs 10 apiece will be issued to the company at a premium of Rs 541 per share of Policybazaar (PB Fintech). It will be allotting 75,37,688 equity shares of Rs 10 apiece at a premium of Rs 388 of Paisabazaar.

According to PB Fintech, the existing investments will help to strengthen the financial health of both wholly-owned entities and fulfill their general operating expenses, as well as improve brand awareness, strategic initiatives, and office presence. Paisabazaar’s turnover in FY21 was Rs 188.32 crore, compared to Rs 226.19 crore in FY20, according to the filing. Policybazaar’s revenues in FY21 were Rs 606.94 crore, up from Rs 515.92 crore in FY19.

Policybazaar, founded in 2008 by Yashish Dahiya, Avaneesh Nirjar, and Alok Bansal. It aggregates insurance policies from a range of providers for use-cases such as life insurance, health insurance, automobile insurance, among many others. PB Fintech, the parent company of the Policybazaar & Paisabazaar platforms, is India’s largest online marketplace for insurance as well as lending products, leveraging data, technology, and innovation. It seeks to raise awareness among Indian households about the financial impact of death, disease, and damage by providing easy access to insurance policies, credit, among other financial services.

Meanwhile, Paisabazaar.com, a consumer credit digital marketplace, has consolidated its partnership with Axis Bank in order to introduce a pre-qualified program for unsecured loans on its platform. Paisabazaar.com’s pre-qualified program involves significant technology and analytics collaboration with Banks and Nonbank financial companies (NBFCs), allowing select customers to view customized and pre-qualified lending offerings on the fintech’s platform.

Paisabazaar has over 50 partnerships with major banks, large NBFCs, and fintech lenders to provide consumers with a diverse range of lending options on its platform. According to Frost & Sullivan, Paisabazaar was India’s largest consumer credit marketplace in Fiscal 2020, with a 51.4 percent market share based on disbursals.

Customers of Axis Bank, both salaried as well as self-employed, who are eligible for pre-qualified personal loans from the bank, will now be able to browse and enroll for the same offers on the Paisabazaar platform. This integration would result in instant credit for these selected consumers via an end-to-end digital process that can be approved by clicking a few buttons on Paisabazaar.

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