Singapore state fund Temasek Holdings Pte and Paris based asset manager Carmignac Gestion are in talks to buy a minority stake in the insurance unit of India’s largest lender ICICI Bank Ltd., several media reports said, citing people close the developments.
In a separate development, Temasek along with other investors are also reportedly in talks with India’s Capillary Technologies Pvt Ltd, to infuse around $80 million into the SaaS-based CRM solutions provider.
International newswire Bloomberg in a recent report said that Indian lender may sell about 5% stake in ICICI Prudential Life Insurance Co. part-owned by Prudential Plc, by the end of March.
ICICI Prudential Life Insurance Co is also the country’s largest life insurance company.
ICICI follows Housing Development Finance Corp., the country’s largest mortgage lender, in attracting investors to its insurance venture ahead of planned initial public offerings, the Bloomberg report said.
The move comes as India is looking to open up the insurance sector to increased foreign investment. Earlier this month, the lower house in the Indian parliament, where Prime Minister Narendra Modi’s government holds a majority, had approved the Insurance Bill. But the Bill must also be passed by the upper house, where the BJP-led government does not have a majority.
“ICICI Prudential Life had a 16.2 percent share of first-year premiums in the twelve months through Dec. 31, making it the country’s biggest private life insurer by that measure ahead of HDFC Standard Life Insurance Co., data from the Insurance Regulatory and Development Authority of India show. ICICI holds 74 percent of its insurance arm, while Prudential owns the rest,” the Bloomberg report added.
Temasek to lead in $80 million investment round in Capillary Technologies?
According to tech news site TechCircle.In, Capillary Technologies, a SaaS-based CRM solutions provider based in Bangalore, is negotiating a funding arrangement worth US$80 million from Temasek Holdings, alongside other investors.
Established in August 2008 by Aneesh Reddy, Krishna Mehra and Ajay Modani, Capillary Technologies offers cloud-based software solutions that aid retailers in engaging with customers through mobile, social and in-store channels. Capillary claims its integrated marketing platform benefits retailers, helping them to manage their customer data.
This data management benefits the business by allowing them to gain insights into customer behaviours, as well as personalise customer engagement across multiple channels. In the past few months, Temasek and other Singaporean government-linked companies have engaged in a series of investments in India-based assets.
This move by Temasek, if true, is understandable given the bullish predictions of India’s economic growth in 2015 by the likes of Christine Lagarde, current managing director of the International Monetary Fund, economic growth forecast to hit 7.7 percent and stronger fundamentals that when compared to the emerging BRICS economies in recent times.
Raghuram Rajan, the Governor of the Reserve Bank of India, has been partially credited for this, stabilising the Indian rupee after being appointed to the post in late 2013. Indias lessened reliance on commodities, compared to Russia, Brazil and South Africa, has also contributed to the current health of India’s economy and growth prospects.
However, India still needs to revitalise its investment ecosystem, as well as accelerate the implementation of key structural reforms regarding foreign investment, according to the IMF.
Paul Cashin, the IMF Mission Chief for India, stated “Growth numbers are now much higher and the current account deficit is comfortable, in part due to the fall in gold imports and lower oil prices. New investment project announcements have started to pick up, particularly in the power and transport sectors.”