Private insurer Liberty General Insurance (LGI) on Friday said its promoters have infused Rs 100 crore in the company last month, reflecting their confidence in the firm’s ability to build a substantial business in India.
The company has also denied rumours around its stake sale.
“Liberty General Insurance’ promoters, Liberty Mutual Insurance Group, Enam Securities, and DP Jindal Group remain confident of the company’s ability to build a substantial business in India.
“With a further infusion of additional capital of Rs 100 crore made in July 2020 by its promoters, the total invested capital including share premium is now Rs 1,834 crore,” said Roopam Asthana, CEO and Whole Time Director, LGI, denying a media report suggesting stake sale.
A media report earlier in the morning suggested Flipkart co-founder Sachin Bansal was eying a stake in the company.
This fresh infusion of capital by the promoters amid prevailing difficult economic situation in the country indicates their commitment and confidence in Liberty General’s ability to grow profitably for many years to come, Asthana said.
The company has undergone several rounds of capitalisation, LGI said, adding the current promoters are committed to the company’s long-term growth.
LGI said it is financially strong with a solvency ratio of 2.65 (as on June 30, 2020) as against required regulatory solvency ratio of 1.5, indicating adequate capital support for planned growth.
Overall, the company registered year-on-year growth of over 36 per cent for the fiscal ended March 31, 2020. It has also recently launched a new product — Liberty Critical Connect – and an innovative offering Liberty Assure under the regulatory sandbox mechanism, it said.
LGI is a joint venture between Liberty Citystate holdings PTE Ltd – a group company of US-headquartered Liberty Mutual Insurance Group, Enam Securities, and Diamond Dealtrade (a DP Jindal Group company).
It commenced operations in 2013 and offers motor, health and personal accident covers apart from commercial, fire, engineering and marine insurance.
Cash-strapped Videocon Industries, which is fighting a bankruptcy case in the National Company Law Tribunal (NCLT), exited from the general insurance business in early 2018 by selling its entire 51 per cent stake in the then Videocon Liberty General Insurance to the DP Jindal Group and Enam Securities.
While DP Jindal Group presently has 26 per cent stake, Enam Securities holds 25.32 per cent in Liberty General Insurance Company. The foreign partner Liberty Mutual Insurance Group holds 48.68 per cent in the firm.
The company has an employee strength of over 1,100 with presence across 100 plus locations in 29 states and UTs. Its partner network consists of about 5,100 hospitals and more than 4,300 auto service centres.
Source: Business-Standard