NEW DELHI: Yoga guru Baba Ramdev’s Patanjali is foraying into insurance sector as billionaire Adar Poonawalla’s Sanoti Properties has approved the sale of its insurance subsidiary, Magma General Insurance Limited (formerly Magma HDI General Insurance Company Limited), to Patanjali Ayurved Limited and Noida-headquartered diversified conglomerate DS Group for approximately Rs 4,500 crore.
The deal is subject to regulatory approvals and has been structured under a Share Purchase Agreement (SPA). Besides Sanoti Properties LLP, Celica Developers and Jaguar Advisory Services are also participating in the sale.
Patanjali Ayurved, a major player in India’s FMCG sector with a wide range of products including cosmetics, ayurvedic medicines, personal care, and food items, is now eyeing the underpenetrated general insurance market. A spokesperson for Patanjali highlighted the sector’s potential, citing recent regulatory reforms such as the opening up of 100% Foreign Direct Investment (FDI) and the Insurance Regulatory and Development Authority of India’s (IRDAI) vision of "insurance for all by 2047."
“Structurally general insurance In India is significantly underpenetrated vis a vis developed countries and IRDAI vision for insurance for all by 2047 could go a long way in plugging the gap. Magma General Insurance could benefit immensely from our ability to infuse growth capital, huge distribution strength including access to rural markets as Patanjali Ayurved products are available at 2,00,000 counters, national level chains including Reliance Retail, Hyper City, Star Bazaar and 250 Patanjali Mega Stores,” added the spokesperson.
Magma General Insurance offers a portfolio of over 70 insurance products, covering both retail (Motor, Health, Personal Accident, Home Insurance) and commercial (Fire, Engineering, Liability, Marine Insurance) categories. The insurer reported a Gross Written Premium (GWP) of Rs 3,295 crore in FY24 and is projected to achieve a GWP of Rs 3,650-3,700 crore in FY25, with an expected Profit Before Tax (PBT) of Rs 20-25 crore.
Adar Poonawalla, who heads the Serum Institute of India and is associated with Sanoti Properties, expressed confidence in Magma’s future under the new ownership.
“We are proud that over the last few years, Magma General Insurance has built up its business carefully, both on the retail and corporate side, with over 1000 agents, 14 OEMs including all the large OEMs, and more than 80 players in the financial services business. It has delivered a growth rate of 26 percent over the last 5 years,” added Poonawalla.