IPO Snapshot 18 September 2017

SBI Life Insurance Company Ltd

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Background & Operations: SBI Life Insurance Company Ltd (SBI Life) is India’s largest private life insurer, in terms of New Business Premium generated in each fiscal year, since Fiscal 2010. It has increased its market share of New Business Premium generated among private life insurers in India, from 15.87% in Fiscal 2015 to 20.04% in Fiscal 2017. In Fiscal 2017, it enjoyed a market share of Individual Rated Premium of 20.69% among private life insurers in India and 11.16% of the entire life insurance industry in India SBI Life was established as a joint venture between the State Bank and BNPPC in 2001. As of March 31, 2017, State Bank was India’s largest commercial bank in terms of deposits, advances and number of branches. Following its recent merger with certain of its associate banks and a non-affiliate bank, with effect from April 1, 2017, State Bank had 24,017 branches and 195 international offices in 36 countries and more than 420 million customers. BNPPC, an insurance subsidiary of BNP Paribas, with operations across 36 jurisdictions internationally, is among the leading credit life insurance businesses globally. BNP Paribas was a top 10 global financial institution in terms of revenues in 2016. Its relationship with State Bank and BNPPC has enabled to enhance its brand, access specialist industry expertise, grow business and consolidate market position As of July 31, 2017, SBI Life had a comprehensive product portfolio of 37 individual and group products (of which eight products are group products), including a range of protection and savings products to address the insurance needs of diverse customer segments. Its individual products include participating products, non-participating protection products, other non- participating products and unit-linked products. It has developed a multi-channel distribution network comprising an expansive bancassurance channel, including State Bank, the largest bancassurance partner in India, a large and productive individual agent network comprising 95,177 agents as of July 31, 2017, as well as other distribution channels including direct sales and sales through corporate agents, brokers, insurance marketing firms and other intermediaries. In Fiscal 2017, it collected the highest amount of New Business Premium generated by private life insurers in India both through the bancassurance channel as well as through an individual agent network The company has also developed long standing institutional relationships with large corporates with respect to its group life insurance products. In Fiscal 2017, SBI Life had 13th month and 61st month Persistency Ratios of 81.07% and 67.18%, respectively, with its 61st month Persistency Ratio being the highest among the top five private life insurers (in terms of total premium in Fiscal 2017) in India. Its Death Claims Settlement Ratio improved from 92.33% in Fiscal 2015 to 97.98% in Fiscal 2017, and was 89.61% for the three months ended June 30, 2017. It has consistently maintained its Solvency Ratio at over 2.00 in each of the last five fiscal years, and at 2.11 as of June 30, 2017, compared to the IRDAI mandated minimum Solvency Ratio of at least 1.50.

SBI Life’s New Business Premium, Gross Written Premium and New Business Annualized Premium Equivalent increased at a CAGR of 35.45%, 27.80% and 36.59%, respectively, between Fiscal 2015 & Fiscal 2017, while Individual Rated Premium increased at a CAGR of 37.90% in the same period. Assets under management (“AUM”) increased from Rs. 713,389.30 million as of March 31, 2015 to Rs. 977,366.03 million as of March 31, 2017, & was Rs. 1,012,260.34 million as of June 30, 2017. Its AUM was the second highest among top five private life insurers (in terms of total premium in Fiscal 2017) in India as of March 31, 2017. Its PAT increased at a CAGR of 8.24% from Rs. 8,148.67 million in Fiscal 2015 to Rs. 9,546.53 million in Fiscal 2017 & was Rs. 3,134.48 million for the three months ended June 30, 2017. It turned profitable within the first five years of its operations, and has declared dividends every year since Fiscal 2012.

Issue Snapshot:

Issue Open: Sep 20 – Sep 22 2017 Price Band: Rs. 685 – 700

Issue Size: 120,000,000 Equity Shares (Entirely Offer for sale) including Employee Reservation and SBI Bank Shareholders reservation)

Offer Size: Rs.8220 – 8400 crs

QIB upto 53,000,000 eq sh Retail atleast 37,100,000 eq sh Non Institu atleast 15,900,000 eq sh SBI Shareholder upto 12,000,000 eq sh Employee upto 2,000,000 eq sh Face Value: Rs 10

Book value: Rs 58.79 (June 30, 2017)

Bid size: - 21 equity shares and in multiples thereof 100% Book built Issue Capital Structure: Pre Issue Equity: Rs. 1000.0 cr Post issue Equity: Rs.1000.0 cr

Listing: BSE & NSE

Book Running Lead Manager: JM Financial Institutional Securities Ltd, Axis Capital Ltd, BNP Paribas, Citigroup Global Markets India Private Limited, Deutsche Equities India Private Limited, ICICI Securities Limited, Kotak Mahindra Capital Company Limited, SBI Capital Markets Limited.

Registrar to issue: Karvy Computershare Pvt Ltd

Shareholding Pattern

Shareholding Pattern

Pre issue

%

Post issue

%

Promoters & Promoter Group

96.10 84.10

Public (incl institutions

& employees) 3.90 15.90

Total 100.0 100.0

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Objects of Issue: The objects of the Offer are to achieve the benefits of listing the Equity Shares on the Stock Exchanges and to carry out the sale of up to 120,000,000 Equity Shares by the Promoter Selling Shareholder. The listing of the Equity Shares will enhance the “SBI Life” brand name and provide liquidity to the existing shareholders. The listing will also provide a public market for the Equity Shares in India. The Company will not receive any proceeds from the Offer. The Allotment of Equity Shares to Eligible Employees under the Employee Reservation Portion would not result in an increase, directly or indirectly, in the shareholding of its Promoters.

Competitive Strengths: One of the largest private life insurers with a consistent track record of rapid growth.

Significant brand equity and pre-eminent Promoters.

Expansive multi-channel distribution with pan-India bancassurance channel and high agent productivity.

Sustainable business model driven by robust financial position, superior investment performance, diversified product portfolio and effective risk management.

Strong focus on customer service standards.

Professional and Highly Experienced Board of Directors and Senior Management Team.

Business Strategy: Capitalize on insurance industry growth opportunities.

Ensure profitable growth through balanced product portfolio and expansive distribution network.

Enhance brand equity and continue to focus on customer satisfaction.

Leverage technology to improve operating efficiencies and support growth.

Key Concerns: An inability to maintain market share, implement growth strategies or effectively address the requirements of specific customer

segments by maintaining a strategic portfolio of insurance products may materially and adversely affect its business operations and prospects, and consequently its financial condition and results of operations;

Any termination of, or adverse change in, SBI Life’s bancassurance arrangements, and in particular its bancassurance agreement with the State Bank, or a decline in performance standards of its bancassurance partners, may have a material adverse effect on its business, results of operations and financial condition;

A significant proportion of SBI Life’s New Business Premiums are generated by a certain category of products. Any regulatory changes or market development that adversely affects the sale of such products could have a material adverse effect on its business, financial condition and results of operations;

Any adverse change in SBI Life’s relationship with its individual agents and other distribution intermediaries, a decline in performance of its agent or other distribution network or an inability to enter into additional distribution arrangements may have a material adverse effect on its business, results of operations and financial condition; and

SBI Life’s investment portfolio is subject to liquidity risk and volatility in the market value of such financial instruments and may be concentrated in certain asset classes.

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