PB Fintech shares gain after SoftBank reduces stake by half; details here

Around 2.28 crore shares, amounting to 5.1 percent equity, of PB Fintech (parent company of Policybazaar) changed hands in a block trade today, 2 December. After the news, PB Fintech was trading at a price of Rs 470.20 per share at 12:51 pm, which is a jump of 2 percent since the market opened. The identity of the buyers and sellers were not known, as per a Moneycontrol report but it was earlier reported that the Japanese conglomerate SoftBank Group Corp was planning to offload a 5 percent stake in PB Fintech through a block deal today. Softbank’s SVF Python II (Cayman) had acquired stake at Rs 290 per share according to the Red Herring Prospectus (RHP) of PB Fintech. This implies a 51 percent return on investment. The stake is held by Softbank through SVF India Holdings (Cayman) Limited as well, whose cost of acquisition is unknown. Presently, SoftBank holds nearly a 10 percent stake in Policybazaar. Therefore, its stake will be reduced to 5 percent after the deal. The offloaded stake amounted to Rs 1000 crore. The base price for the block deal stands at Rs 440 per share. The coverage on the stock was recently initiated by the CLSA with a buy rating and target price of Rs 600 apiece. According to the CLSA, more than 10 percent compounded annual growth rate (CAGR) is expected in the broader insurance industry over 15 years. CLSA added that it sees PB Fintech as a significant beneficiary of the online insurance distribution’s growing share. Existing stakeholders of many listed new-age technology companies have been focusing on partially selling their stake as a major erosion is being seen in the value of stocks. Tiger Global Eight Holdings offloaded 76.13 lakh shares in PB Fintech at an average price of Rs 374.09 a share and another 32.84 lakh shares at an average price of Rs 388.34 per share on 11 November after PB’s pre-IPO lock-in expired. A total of 51.59 lakh shares were sold by the Internet Fund III Pte Ltd also at an average price of Rs 375.11 per share. The consolidated loss of the company reduced to Rs 186.63 crore in Q2 against the Rs 204.44 crore loss reported in the same quarter last year. For the period, its revenue from operations increased 105.11 percent Year-over-year (YOY) to Rs 573.47 crore, caused by firm growth in credit disbursal, insurance premiums, and operating revenue. Read all the Latest News , Trending News , Cricket News , Bollywood News , India News and Entertainment News here. Follow us on Facebook, Twitter and Instagram.