LIC plans to acquire a 50% stake in ManipalCigna Health Insurance, potentially entering the health insurance market with a deal valued at ?4,000 crore. ManipalCigna, a joint venture between the Manipal Group and Cigna Corporation, may see both parties reducing their stakes if the agreement materializes. LIC's Managing Director, Siddhartha Mohanty, hinted at the acquisition during the company’s earnings call on November 8.
According to sources, LIC is in talks to secure half of ManipalCigna’s ownership, aiming to diversify from its life insurance portfolio and tap into the growing demand for health insurance. This market accounts for 37% of India’s ?3 lakh crore general insurance industry.
The Manipal Group currently holds 51% of ManipalCigna, while Cigna Corporation owns the remaining 49%. If the deal is finalized, LIC will benefit from entering a fast-growing sector underserved in medical expense coverage. Both Manipal Group and Cigna Corporation are expected to proportionately reduce their stakes.
Visit this link B.Sc Industrial Microbiology
Although spokespersons from ManipalCigna and LIC declined to comment on the development, sources revealed that both parties have signed a non-disclosure agreement and are progressing in discussions.
Market Valuation
ManipalCigna’s valuation, though unlisted, is estimated at ?3,500-4,000 crore based on its gross written premium (GWP) of ?1,691 crore in the last fiscal year. Comparatively, Niva Bupa Health Insurance, with a GWP of?5,600 crore in FY 2024, has a market capitalization of nearly?13,740 crore. Star Health & Allied Insurance, reporting ?15,251 crore in GWP, enjoys a higher market value.
At this valuation, LIC may need to invest ?1,750-2,000 crore to acquire a 50% stake in ManipalCigna. This move aligns with LIC’s strategy to expand its presence in standalone health insurance, leveraging the sector’s growing demand.
You may like also
