Uzbekinvest leads the way in Uzbekistan's insurance market with historic IPO [video]

Uzbekinvest, Uzbekistan's preeminent export-import insurance company, recently made headlines by launching its initial public offering (IPO) on the Republican Stock Exchange "Tashkent", a first among the nation's 38 insurance firms. The IPO, offering 5% of Uzbekinvest's authorized capital or UZS14.1bn, was accompanied by a detailed investor Roadshow at the Hilton Tashkent City Hotel.

During the presentation, Uzbekinvest's management and its underwriter, Kapital-Deposit Investment Company, discussed the company's strategy, financial health, and growth prospects. The IPO’s price range was set at UZS1,000 to UZS1,500 per preferred share, with over 14 million shares issued. These shares promise a guaranteed dividend income at the Central Bank of Uzbekistan refinancing rate plus 10%. The funds generated from the IPO will be allocated for capital expenditures and expanding its presence in the global market, with a specific emphasis on enhancing infrastructure and technological solutions.

What has Uzbekinvest achieved so far?

The company's impressive insurance protection portfolio, includes coverage of $1.8bn for national product and service exporters and a substantial increase in corporate and individual insurance premiums. The company insured 35% of the country's raw material exports to 58 different countries.

In the corporate insurance segment, Uzbekinvest achieved a notable increase in insurance premiums, reaching UZS 479bn, which is 3.4 times higher than the figure recorded at the end of the ninth month of 2022. The company successfully concluded over 70,000 contracts with various legal entities.

Regarding individual insurance, the company collected premiums totaling UZS 65.1bn, marking a 1.8-fold increase from the same period last year. In the first nine months of this year, Uzbekinvest signed 713,400 contracts with individual clients, a 1.3-fold rise compared to the same period in the previous year. Additionally, under the "Mahallabay" project, the company gathered insurance premiums amounting to UZS 30.2bn in the same nine-month period.

Vyacheslav Pak, the First Deputy Director of the National Agency of Perspective Projects (NAPP), in his opening remarks, lauded the IPO: "Uzbekinvest's IPO is a pivotal step, not only enhancing the transparency of the insurance market but also invigorating the securities market. The company's management and employees have undertaken extensive work to align with international standards and earn recognition for financial stability from global rating agencies."

Investors, both individual and corporate, including foreign entities, can participate in Uzbekinvest's IPO by opening a brokerage account with KAP DEPO, the IPO's underwriter, which facilitates online account creation and application submission through ipo.kapdepo.uz. The deadline for share application is December 15.

In response to questions from Daryo’s correspondent, Pak acknowledged the challenges in the Uzbek insurance market, especially the risks stemming from the collaboration between insurance companies and commercial banks. He confirmed NAPP’s awareness of the issue and its commitment to regulatory improvements to foster a more stable capital market.

Rustam Azimov, CEO of Uzbekinvest, while countering the notion that the Uzbek insurance market is risky, emphasized Uzbekinvest’s significant role in revitalizing the market. He detailed the company's expansion since its inception in 1994 and its international growth since 2017, now operating in over 120 countries. 

Uzbekinvest's reinsurance operations span 120 countries, with international insurance and reinsurance income constituting over 80% of total insurance income. Notably, in May 2023, Moody's Investors Service Ltd. upgraded Uzbekinvest's financial strength rating forecast to "Positive" and "Ba3", reflecting the company's growing stability and credibility in the global market. 

This IPO represents a significant milestone for Uzbekinvest and the Uzbek insurance sector, signaling a commitment to transparency, international standards, and market vitality.

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