Momentum Group is considering an initial public offering (IPO) for its Indian venture with billionaire Kumar Mangalam Birla. This move aligns with the South African insurer's strategy to expand its footprint in Asia's third-largest economy.
Momentum Group, based in Centurion, has approximately R3 billion ($172 million) in excess capital. The company intends to allocate a third of this amount to expand its operations in South Africa and introduce new services in India, according to Momentum CEO Jeanette Marais. Currently, Momentum controls about 44% of Aditya Birla Health Insurance Co. Aditya Birla Capital Ltd owns approximately 46% of the unit.
Marais noted that an IPO could potentially unlock significant value in a market like India, provided the timing and market conditions are favorable. She stated that all possibilities are being considered for the future, but the company aims to proceed when the time and market align with their interests.
Momentum's strategic focus on India is underscored by its decision to scale back its operations in other African markets, including Nigeria, Kenya, and Ghana. The company currently maintains operations in Mozambique, Namibia, Botswana, and Lesotho. Aditya Birla Health has achieved break-even, with normalized headline earnings increasing by 76% in the year leading up to June.
The potential IPO is fueled by Momentum's desire to invest in high-growth markets such as India, where Aditya Birla Health Insurance Co. has reached break-even.
The backdrop to this potential IPO is a shifting landscape for startup IPOs in India. While 2024 saw a record number of startup listings, momentum has slowed in 2025 due to global volatility, investor caution, and regulatory changes. Despite a healthy pipeline of companies that have filed draft documents with SEBI, only a handful have launched IPOs this year.
According to a KPMG report, India saw nearly 80 mainboard IPOs, slightly higher than 76 in FY24, with total capital raised amounting to INR 1,630 billion, a significant jump from INR 619 billion in the previous year.
Even with the cautious sentiment, experts suggest that the current slowdown represents a necessary market correction, bringing valuations closer to fundamentals. Some also point out that regulatory changes have made it easier for startups to head to the bourses. While the IPO market may not return to the frenzy of the previous year, there is a gradual recovery underway with a more measured pace of IPO launches.
