In 2008 Yashish Dahiya went to Infoedge. He did something brilliant that in the first meeting itself VC of Infoedge company agree for the deal he wanted to execute. Ashish Dahiya is also known as Ion Man. So can this iron man show his magic in the stock market, we will try to figure this out in this article. There are also many concerns for the valuation of this company. We will address that too in this article.
History:
For the seed funding of Policy Bazaar Yasish Dahiya went to infoedge founder Sanjeev Bikhchandani. You may know that Sanjeev Bikhchandani was the one who also invested in Zomato. His invested one million dollar in zomato become more than one billion dollar after the IPO of Zomato.
So in the meeting Yashish state a bold statement that Sanjeev was paying 60 percent more in his car premium. Mr. Sanjeev was little bit surprised to know that and asked Yashish to show the demo. Then Yashish quickly showed the prototype of Policy Bazar where he shows and told “here are some car insurers there who are giving same feature in lower money. It is sometime even 60 percent lower in some case. Mr. Sanjeev was very happy after seeing this. He immediately invested 30 crores in this company which was the highest investment of his at that time. policy Bazar
Truth about the Policy Bazaar
To understand policy bazaar at first we have to understand the insurance market as a whole. Generally insurance industry is considered as a very complex. But we will try to break this in simple words. At present policy bazaar have more than 90 percent market share in the industry. But you should not make conclusion on this single fact.
Firstly, you will shocked to know the number which are sell online. It is only 1 percent which is far far low than any other developed countries. Among the 1 percent half of the policies are sold by the app of the insurance company. Other half are sold by the insurance aggregators like policy bazaar.
Master Plan of Policy Bazaar
So now you understand maybe policy bazaar have the highest percent of digital insurance but the market itself is not that much big, at least till now. This penetration is very low but there is very great opportunity for this company to expand in future time.
After the pandemic this type of companies get the boom it wanted for years. As people tend to understand the importance of health and life insurance, many people did it online. So by this year and year profit is getting higher for policy bazaar.
Setback of Policy bazaar
But there is a big concern for this company as HDFC ERGO, ICICI lumbard and LIC left the policybazar. The main motive of Policy Bazar was to remove agent while doing an insurance. But as they are not getting that much success they are changing their master plan.
They started to set up offices offline and selling insurance. They got insurance broking by which they can sell the insurance that is a big chance to grow for this company.
Other aspects:
They have an other business which is known as paisabazar where they connect lender and borrower. After the pandemic that business is not working well.
If you calculate price to sales ratio it was very high in case this company. So the valuation is quite higher than actual price. But this type of start up can play long term game in future. So you should do every research before investing in this company.