Mumbai, Sept. 15: The initial share sale of ICICI Lombard General Insurance Company today got off to a modest start with the flotation witnessing a subscription of 27 per cent.

However, market observers expect investor interest to improve given the company's strong management and the huge potential for general insurance in the country.

ICICI Lombard will be the first general insurer to get listed on the bourses. The IPO, which is looking to raise about Rs 5,700 crore, received bids for 1,66,69,466 shares against an issue size of 6,16,66,740, data from the NSE showed.

The category for qualified institutional buyers (QIB) was subscribed 62 per cent, non-institutional investors four per cent and retail individual investors 18 per cent. In the QIB category, of the over 1.63 crore shares reserved, bids were received for more than 1.02 crore shares. Retail investors bid for 50.67 lakh shares against 2.87 crore shares reserved for this category.

ICICI Lombard General Insurance yesterday raised Rs 1,625 crore from anchor investors. The IPO involves dilution of up to 86,247,187 shares by promoters - ICICI Bank and Fairfax. The offer will close on September 19.

The insurer is looking to raise about Rs 5,700 crore at the higher end of the price band, fixed at Rs 651-661 per share.

However, there are valuation concerns.

"Even if the money raised at such valuations was flowing into the company, it would have ultimately belonged to the shareholders. But, in this case, 100 per cent of the money raised is going to the selling shareholder and not to the company," a note from Centrum Wealth Research said.

Max Fin stake

Goldman Sachs' subsidiary Xenok Ltd today sold over 1.10 crore shares of Max Financial Services Ltd for nearly Rs 665 crore through open market transactions. According to data available with BSE, Xenok offloaded 1,10,79,700 shares, amounting to 4.14 per cent stake, in MFSL.

The shares were disposed of at an average price of Rs 599.95 per scrip, valuing the transaction at Rs 664.73 crore, as per the data.

"However, the company may attract adequate interest as it is the first general insurance listing, besides reasons such as under-penetration in the sector and the company's healthy financials. If so, the stock may list at a premium to the issue price. If that does not happen, investors should be ready to expect returns only in the long term," the note aICICI Lombard General Insurance yesterday raised Rs 1,625 crore from anchor investors. The IPO involves dilution of up to 86,247,187 shares by promoters - ICICI Bank and Fairfax. The offer will close on September 19.