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ManipalCigna Health Insurance Company is a joint venture of Manipal Group and Singapore Corporation. If this deal happens, LIC will buy equal stakes of both companies.

LIC Health Insurance: The country's largest life insurance company LIC is planning to enter the health insurance sector. To enter the fast-growing health insurance sector in the country, the company is trying to buy half of ManipalCigna Health Insurance. The deal is expected to be worth Rs 4,000 crore. If there is a deal between Singna Health Insurance and LIC, then this will allow the life insurance company to enter the health insurance sector. Let us tell you that ManipalCigna is a joint venture between Manipal Group and Singapore Corporation.

The MD of LIC had also hinted at the acquisition

According to the news published in the Times of Economy, if this agreement is reached, then both will reduce their stake. The MD of LIC had also hinted about this acquisition in the past. People associated with this matter said that the country's largest insurance company wants to enter the fast-growing health insurance sector at a low cost. For this, talks are going on to acquire half stake in ManipalCigna Health Insurance.

ManipalCigna has a 37% share

in health insurance Manipal Education & Medical Group and US-based Cigna Corporation. Bengaluru-based Manipal Education Group holds 51% stake in the health insurance company, while Cigna Corporation holds the remaining 49%. If this deal is finalized, then it will give the government insurance company LIC an opportunity to do business separately from its life insurance portfolio. Let us tell you that health insurance accounts for 37 percent of the country's insurance sector.

A person associated with

the case said that both parties have signed a non-commercial agreement. LIC is going ahead with the matter on acquiring a 50% stake in this venture. According to initial talks, Manipal Group and Cigna Corporation will reduce their stake in the insurance company proportionately. Another person said that this deal could fetch the health insurance company about Rs 4,000 crore.

No information has been

given about any kind of official information, although no information has been given by the spokesperson of ManipalCigna and LIC about this. Let us tell you that on November 8, LIC MD and CEO Siddharth Mohanty said that LIC is planning to enter the health insurance market. He said at that time that we are preparing for this. However, he did not give much information about it at that time.

Public information about the valuation of the nonlisted company ManipalCigna is not available. But the valuation of selected standalone health insurance companies is two to three times their gross tin premium (GWP). At the close of Wednesday's trading session, Niva Bupa Health Insurance, which has a market cap of around Rs 13,740 crore based on share price, reported a GWP of 5,600 crore for FY24. Similarly, Star Health and Allied Insurance, which clocked a GWP of Rs 15,251 crore, has a market cap of Rs 26,843 crore.

Based on this matrix, ManipalCigna recorded a GWP of Rs.1,691 crore in the last financial year. This means the valuation of the company can be around Rs 3,500-4,000 crore. If LIC chooses to acquire a 50% stake in the company, it may have to pay around Rs 1,750-2,000 crore on this valuation.