Nothing changes on ground for Bajaj Finserv Ltd.'s life and general insurance businesses, which will now be 100% owned by the group, Chairman and Managing Director Sanjiv Bajaj told NDTV Profit in an interview.
This comes after Bajaj Group bought out Allianz's 26% stake each in both Bajaj Allianz Life Insurance and Bajaj Allianz General Insurance. The transaction is being done at a cost of around Rs 24,000 crore.
Whether it is long term plans, the annual budget, the board, the management, operations, teams, or partners, all stay the same, Bajaj said.
"They know that, of course with the support of Allianz, but Bajaj has been running this show through an effective independent board. Nothing changes on ground materially. The branding might change with regulatory approval, but it is Bajaj that sells in India," he said.
When it comes to potential listing of the two insurance businesses, the board of Bajaj Finserv will take a call at an appropriate time, Bajaj said. Both companies do not need to list immediately for any capital needs, he added.
"Both our companies are every adequately capitalised. We have not needed to put in funds for over a decade because they balance growth with profit and they are still among the largest in their sectors," Bajaj said.
However, the insurance regulator held discussions with some of the larger and older companies, nudging them to list, he added.
"In our case, no, it will not happen in the immediate future. Because we have to go through this transition and then look at it. At the right time our board will seriously take a look at listing a possible alternative," Bajaj said, adding that there is no clear timeline on when this will happen.
Speaking about competition in the insurance sector, Bajaj said that the sector is currently crowded, but all sensible competition is good competition. Companies which have come into the sector over the last decade have not been able to make much of a dent in the businesses of the older insurance companies.
"Sensible competition is good competiton. If you get into the same discounting game as everyone else, the big boys have more strength," Bajaj said.
Pricing of the acquisition of Allianz's stake was fair to both partners. It allows Allianz a clean exit from the business and they are now free to pursue whatever else, he said.
"Effectively, a ship is captained by one captain. You have the support of the crew. When each person wants to be their own captain, you need two ships," Bajaj said.
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