Liberty Videocon General Insurance is headed for capital infusion of Rs 310 crore as its foreign JV partner is set to raise stake to 49 per cent, the limit under the revised guidelines for the insurance sector, a top official said.
"We have applied to IRDAI for 49 per cent FDI. We are right now capitalised by Rs 680 crore. We are getting another Rs 310 crore. So, we will be close to Rs 1,000 crore as capital from Liberty, among the highest in general insurance space," Pankaj Arora, Country Head-Retail, Liberty Videocon General Insurance, told PTI.
"This will come from the foreign partner, taking the holding to 49 per cent."
The joint venture is between India's Videocon Industries and Liberty Citystate Holdings Pte, part of the US-headquartered Liberty Mutual Insurance Group.
The JV company had launched its operations in India in 2013, with a current market share of 0.4 per cent. It looks to become one of the dominant players in the general insurance business.
"Liberty and Videocon both have invested in India to keep growing year on year. We will see some exponential growth in years to come. We would be at least growing by 80-100 per cent next year as a business," he added.
With plans to expand its branch network to 80 in about 2-4 months, Arora said the intent for India is "very very clear" as capital is being lined up.
As per the plan, the new branches will come up in tier- 2 and 3 cities as penetration there is very low. Talking about a timeframe to turn profitable, Arora said the company will break-even before the industry average of 8-10 years.
"Right now, we are not profitable, it has been three years. If you look at the industry, most gain profitability in 8-10 years. But we would like to better it. It should be at 6-7 years," Arora asserted.