Roshan Padamadan presented his in-depth investment thesis on Life Insurance in India: ICICI Prudential (India: IPRU) and Max Financial (India: MAXF) at Asian Investing Summit 2017.

Life Insurance in India is an attractive market, as there is ample room for growth (one statistic: only 28 million Indians, out of a population of 1.25 billion, are tax filers; of the latter, only 12 million actually pay taxes). The government’s recent attack on the cash economy is good for regulated products. Insurance is being increasingly bundled with other products, such as bank deposits and remittance services. There is limited competition in the life insurance market, as banc-assurance is the dominant distribution channel (~70%) for private players. Roshan believes that the insurance industry can grow at 2x GDP, resulting in a potential CAGR of 12% over the next two decades.

ICICI Prudential, founded in 2000 and based in Mumbai, is one of the largest private life insurance players in India. The company is 55%-owned by ICICI Bank and 26%-owned by Prudential Corporation (Prudential may sell down further to a floor of 20%).

Max Financial, founded in 2000 and based in New Delhi, is one of the largest private life insurance players in India. It will become the largest players, ahead of ICICI Prudential, following the proposed merger with HDFC Life, which should be completed in Q4.

About the instructor:

Roshan Padamadan is Fund Manager of Luminance Global Fund, which has a global unconstrained investment strategy, looking at special situations and deep value. Prior to launching Luminance in 2013, Roshan spent more than seven years with the HSBC Group, including more than three years with HSBC Asset Management, as a Product Specialist. He worked for the highly commended Offshore Indian Equity team which ran US$5+ billion from Singapore, including a US$100+ million award-winning India hedge fund. Roshan has earned an MBA in Management from Indian Institute of Management, Ahmedabad. He holds the CFA, FRM and CAIA charters and speaks over five languages.

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