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Should you buy Policybazaar shares post 17% listing gains?

Should you buy Policybazaar shares post 17% listing gains?

Shares of PB Fintech, or PolicyBazaar, made a decent debut on Dalal Street on Monday. The scrip listed at a premium of 17.34 per cent at Rs 1,150 on the NSE against the issue price of Rs 980.

Policybazaar collected Rs 5,625 crore through the initial public offerings (IPO) which was opened for subscription on November 1 (Image: policybazaar.com) Policybazaar collected Rs 5,625 crore through the initial public offerings (IPO) which was opened for subscription on November 1 (Image: policybazaar.com)

Shares of PB Fintech, or PolicyBazaar, made a decent debut on Dalal Street on Monday. The scrip listed at a premium of 17.34 per cent at Rs 1,150 on the NSE against the issue price of Rs 980. Earlier, the company collected Rs 5,625 crore through the initial public offerings (IPO) which was opened for subscription on November 1. Later, the issue got subscribed 16.58 times on the last day of the offer on November 3.

The portion reserved for qualified institutional buyers (QIB) was subscribed 24.89 times, retail investors’ subscribed to 3.31 times and non-institutional investors 7.82 times.

Commenting on the further price movement of PolicyBazaar, Aayush Agrawal, senior research analyst - merchant banking, Swastika Investmart said, “The company is a leading fintech firm that aims to enhance its visibility and awareness along with increasing its customer base which is expected to be beneficial for the company. The existing investors are advised to hold the stock with a stop loss of Rs 1,050 while the new investors can look for a dip. We believe the company can perform much better over the long run.”

On the other hand, Manoj Dalmia, founder and director, Proficient Equities said, “The issue seems overvalued at 46 times FY22 mcap/sales on a post-issue basis suggesting to book profits. We expect a good demand if earning are positive in the coming weeks.”

The company is the leading online platform for insurance and lending products, providing access to insurance, credit and other financial products. In 2008, PB Fintech launched PolicyBazaar aimed at catering to consumers who need more information, choice and transparency in insurance policies. PolicyBazaar is an online platform for consumers and insurer partners to buy and sell insurance products.

According to Frost & Sullivan, PolicyBazaar was India’s largest digital insurance marketplace with a 93.4 per cent market share based on the number of policies sold in FY20. As of September 30, 2021, 48 insurer partners offered over 390 term, health, motor, home, and travel insurance products on the PolicyBazaar platform.

PolicyBazaar offers its users pre-purchase research, purchase, including application, inspection, medical check-up, and payment and post-purchase policy management, including claims facilitation, renewals, cancellations, and refunds.

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Also read: Policybazaar shares list at 17% premium to IPO price, market cap rises to Rs 53k crore