SBI to sell 3-5% stake in general insurance JV in FY19

State Bank of India (SBI) will sell 3-5 percent stake in its general insurance subsidiary SBI General Insurance this financial year.

In his post-earnings media interaction, SBI Chairman Rajnish Kumar said, “We are in an active mode to unlock value in our subsidiaries this year.”

SBI is the promoter of two insurance companies, SBI Life Insurance and SBI General Insurance. SBI Life was listed on the stock exchanges in FY18.

Also read: SBI posts Q4 loss of Rs 7,718 crore

SBI General is a joint venture between State Bank of India and Australia's IAG where SBI holds 74 percent stake and IAG holds 26 percent.

In FY18, the insurance company posted an almost 160 percent increase in its net profit for FY18 at Rs 396 crore because of a one-time gain of Rs 131 crore.

Explaining the strategy further, Dinesh Kumar Khara, Managing Director of Risk, IT & Subsidiaries, SBI added, “We plan to look at a sale of 3-5 percent stake in SBI General Insurance this year. We have to look at what value we get at that time."

The general insurance company had also posted its maiden underwriting profit of Rs 32 crore in FY18, compared to an underwriting loss of Rs 197 crore in the year-ago period.

This could also be a price-discovery process for the initial public offering (IPO) of the general insurance company.