Edelweiss Jumps 5%, Insurance JV Gets Nod for Higher FDI

Edelweiss Tokio Life Insurance is a joint venture between Edelweiss Financial Services and Tokyo-based Tokio Marine Holdings Inc. Tokio Marine currently owns 26% in the insurance joint venture company.

Shares of Edelweiss Financial Services  rallied 4.6% intraday Wednesday after its insurance joint venture received approval from Foreign Investment Promotion Board (FIPB) for increasing foreign partner's stake.

Edelweiss Tokio Life Insurance is a joint venture between Edelweiss Financial Services and Tokyo-based Tokio Marine Holdings Inc. Tokio Marine currently owns 26% in the insurance joint venture company. The increase in Tokio Marine’s stake to 49% in the life insurance joint venture will lead to fresh issue of foreign direct investment into the company, said the company.

Since inception in 2011, the Company has expanded its distribution footprint across agency and has built a nationwide network of 60 branches across 50 major cities in India with over 10,000 personal financial advisors.

“The approval is a reinforcement of Tokio Marine's long term commitment to India and to Edelweiss Tokio Life. We are committed to build a high quality and well capitalised business with strong support from Tokio Marine in areas like product design, new technology, etc," said Deepak Mittal, MD & CEO, Edelweiss Tokio Life.
 

This was the second FDI proposal in the insurance space after the government passed Insurance Bill that allows 49 percent foreign shareholding in the sector. The first FDI proposal was from Bharti-Axa.

At 14:22 hours IST, the scrip of Edelweiss Financial Services was quoting at Rs 54.75, up Rs 0.65, or 1.20% on the BSE.