ET Intelligence Group: Foreign portfolio investors (FPIs), normally good at spotting long-term structural bets, are keen on India’s insurance businesses.
Although large private insurers have significant FPI investments, the quantum of increase in FPI holdings over the past year reflects the bullishness of overseas funds.
In the one year to June, FPI stakes in SBI Life and ICICI Lombard General Insurance more than doubled to 19.4 per cent and 18.5 per cent, respectively.
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In the past 18 months, there has been a structural shift, with strategic investors identifying insurance as a sunrise industry.
For FPIs that have little scope to enhance stake in crowded blue-chip ideas, the stability of insurance has become a major draw.
According to various estimates, in the next 2-3 years, India’s insurance industry is expected to expand 12-15 per cent annually.
Source: Economic Times
