Prudential to list Indian asset management venture

INSURER Prudential plc announced that it is considering a partial listing of its stake in ICICI Prudential Asset Management, one of India's leading investment firms. The news sent Prudential's shares soaring by 5.8 per cent to close at 722p on the London Stock Exchange.

The FTSE 100 company currently holds a 49 per cent stake in the Indian joint venture, which market analysts estimate to be worth around £4 billion. ICICI Bank, which owns the remaining 51 per cent, has confirmed its intention to maintain its majority shareholding, emphasising its "long-term commitment" to the partnership that began in 1998, reported the Times.

ICICI Prudential Asset Management has established itself as a significant player in India's investment landscape, managing assets worth approximately £86bn and serving more than 11 million investors across 133 different investment schemes.

The company ranks among India's top asset managers, though it trails behind market leader SBI Mutual Fund, which manages about £112bn in assets.

Prudential said it would return the net proceeds from any potential share sale to its shareholders, though it has not yet specified how much of its stake it plans to sell or which stock exchanges it might choose for the listing. The company maintains dual primary listings in London and Hong Kong.

This potential listing marks another significant step in Prudential's strategic shift towards Asian and African markets. The company, founded in London in 1848, has moved away from its British roots, with chief executive Anil Wadhwani and other top executives now based in Hong Kong. The group even held its annual general meeting in Hong Kong for the first time last year.

Bank of America analysts view the potential divestment as a positive catalyst for Prudential's share price, noting that the joint venture holding represents approximately a quarter of Prudential's total market value when compared to similar Indian asset managers. However, they cautioned that "any listing process could incur costs and lead to a discount."

Despite the planned partial exit, Prudential stressed its continued commitment to the Indian market.

"India is a strategically important market for Prudential with compelling growth prospects. We will continue to explore opportunities to grow our business in the market," the company said in its statement.

The announcement comes as Prudential continues its £1.6bn share buyback programme and follows strong performance in its core business. The Asia-focused insurance group reported a 10 per cent increase in new business profits to about £1.8bn in the nine months to September 2024.

Brian Hanratty, head of equity capital markets at Peel Hunt, noted that while the year has had a "quiet start," he expects "activity to pick up in the second quarter" as companies finalise their full-year accounts before considering public listings.