IndiaFirst plans to raise Rs 250 cr in subordinated debt

By

, ET BureauLast Updated: Aug 28, 2026, 07:24:00 AM IST

Synopsis

IndiaFirst Life Insurance plans to raise ₹150-250 crore through subordinated debt. BNP Paribas Cardif will acquire Warburg Pincus' stake in the insurer. The company's initial public offering plans have been deferred, not abandoned. Its agency channel is expected to contribute a larger share to business. IndiaFirst Life is also seeking new bancassurance partnerships.

Mumbai: IndiaFirst Life Insurance plans to raise ₹150-250 crore through subordinated debt in the fourth quarter, as the company looks to strengthen its capital base, managing director and chief executive Rushabh Gandhi said.

The proposed fundraise will come as the insurer's existing subordinated debt of about ₹125 crore falls due for repayment in the fourth quarter.

The insurer has a solvency ratio of above 190% against the minimum regulatory requirement of 150%. It does not need fresh equity capital from shareholders and has headroom to raise subordinated debt, Gandhi said.

BNP Paribas Cardif is set to acquire Warburg Pincus' 26% stake in IndiaFirst Life. Gandhi said the transaction was a deal between the two shareholders and would not bring fresh capital into the insurer. "Our solvency position does not change because of this deal," he added.

IndiaFirst Life's IPO plans have been deferred but not abandoned, he said. The insurer will first await regulatory approval for the Cardif transaction before deciding on the timing of the listing with its new shareholder.

"The stance on the IPO remains identical to what it has always been: that it's not been shelved; it's been deferred," Gandhi said. The company will have to file a fresh draft red herring prospectus. The transaction is expected to close this calendar year.

IndiaFirst Life also expects its agency channel to become a larger contributor to the business. The insurer has around 17,000 agents and is adding 2,000-2,500 agents every quarter. Agency currently contributes 15-20% to business and is expected to reach about 25% in five years.

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The company is looking for additional bancassurance partnerships following the reduced contribution from Union Bank of India.

Gandhi said it is open to both private and public-sector banks.

First-quarter business growth was tepid with the company posting low-single-digit growth. Excluding the impact of Union Bank of India, IndiaFirst Life would have grown by about 30%, Gandhi said. The insurer extended its distribution tie-up with Union Bank of India until November this year after it ended in March.

IndiaFirst Life has tied up with software firm Salesforce for artificial intelligence-enabled digital solutions. Gandhi said the overall IT budget increased but remained within 5% of operating expenses, with spending rising on agentic AI and cybersecurity.

The insurer does not plan to reduce its agency force due to AI adoption but expects higher productivity and redeployment of employees into more complex roles, he said.

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