Magma HDI General Insurance raises Rs. 525 Cr In Funding Round led by ICICI Ventures & Morgan Stanley PE Asia

Magma Fincorp has informed the bourses that its Insurance JV, HDI General Insurance Limited (Magma HDI), in a funding round led by ICICI Venture and Morgan Stanley Private Equity Asia managed funds along with the Cyza Chem Private Limited, of the Poonawalla Group, and two family offices as new shareholders in the Company. The transaction of Rs 525 crores including secondary transactions of Rs 275 crores.

The company said that the fresh capital infusion of Rs. 250 crores would be deployed towards expanding distribution capabilities of the company. The secondary sale of Rs 275 crores was on account of fulfilling the requirement of Magma Fincorp Limited and its group companies to comply with the Reserve Bank of India’s guidelines for ownership of stake in insurance companies.

Rajive Kumaraswami, MD &CEO, Magma HDI General said that the investments will enable the company expand the business and explore new opportunities, especially in the post-pandemic phase given the increased awareness for insurance protection. Mr. Sanjay Chamria, Vice Chairman & Managing Director, Magma Fincorp Limited said, “Magma HDI has been performing exceptionally well and sky is the limit for the company to realise its full potential and carve out a niche for itself in the GI industry.” 

This round includes investments by the Poonawalla group entities which last week also invested in Magma Fincorp’s Rs. 3,456 crore fundraise. Mr. Adar Poonawalla, Chief Executive Officer, Serum Institute of India, commented, “We are delighted to continue our support as shareholders of Magma HDI and I see huge potential in the growth of Magma HDI” 

The round was led by ICICI Ventures & Morgan Stanley PE Asia. Mr. Puneet Nanda, Managing Director & Chief Executive Officer, ICICI Venture, said, “We are excited about the prospects offered by the under-penetrated Indian insurance sector. We look forward to working 

with the Board and the team of Magma HDI General Insurance”. Mr. Nirav Mehta, Managing Director of Morgan Stanley Private Equity Asia, also commented saying, “General Insurance sector in India is poised for a structural growth phase, and we believe that Magma HDI is well-placed to tap this opportunity” 

Magma HDI General Insurance is a joint venture between Magma Fincorp Limited and HDI Global SE, Germany. The company offers an array of general insurance products for retail and institutional clients. In the retail segment, it offers motor, health, individual personal accident and home; and for corporates, it offers property, fire, marine cargo and liability insurance. Magma shares closed at ₹127.10 apiece on BSE, up 0.25 per cent from the previous close.