No Plans to List TATA AIA

Unlike some of its peers, Tata AIA Life Insurance has no plans of joining the IPO bandwagon. At the recent AIA Media Day in Hong Kong, Ng Keng Hooi, Group Chief Executive and President, AIA Group, said: “We have no interest in listing in India. We have no need to list to raise capital. Financially, we are very strong.”

Hong Kong-based AIA Group, Asia’s largest listed life insurance player, has 49% stake, the maximum permitted currently, in its Indian joint venture Tata AIA Life Insurance.

AIA upped its stake in Tata AIA Life to 49% last year from 26% making use of relaxed foreign investment norms in insurance companies.

Indicating that AIA would be open to acquiring more stake in the Tata AIA venture, if allowed, Ng Keng Hooi added, “Everywhere we operate in, we would like to own as much as we can.” India is among the very few markets where AIA does not have full stake.

On acquisition opportunities in the Indian insurance space, Ng Keng Hooi was guarded, “It should make financial sense, business sense and strategic sense.” He agreed though that recent IPO valuations seemed expensive.

Tough market

India’s insurance market, according to Ng Keng Hooi, has huge potential but is also a tough market. “It is a difficult market compared to some of our other markets. This is unfortunate because the level of insurance protection in India is still very low, even as the economy is growing. Private insurers can take care of some of this need.”

Seeking a more enabling regulatory environment, Ng Keng Hooi said, “There are many regulations in terms of products, costs and distributors. We want to work with the regulator to find ways to grow the business and make sure that a lot more Indians are protected with insurance.”

Appreciating the concerns of IRDAI, Ng Keng Hooi added, “Obviously, the regulator has concerns and some of this is justified. But we hope that the regulator will also see the viewpoint of insurance players.

“We have to understand what the regulator’s concerns are, and how we can work together to make sure that the business is growing.”