Morgan Stanley values Prudential's 49% stake in ICICI Pru AMC between $0.9-1.8 billion

ICICI Bank and Prudential formed a JV in 1998, which has lasted over 26 years.

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England-based insurance major Prudential Plc is considering a potential listing of ICICI Prudential AMC, which would involve a partial stake sale of its 49 percent holding. The partial divestment would be subject to market conditions, requisite approvals and other considerations.

It is intended that following the completion of such a divestment, the net proceeds would be returned to shareholders

According to international brokerage Morgan Stanley, the potential valuation range for Prudential's stake in ICICI Pru AMC would be around $0.9-1.8 billion.

ICICI Prudential AMC's total assets under management as of H1CY24 was $47.6 billion. According to Morgan Stanley, this would theoretically equate to $70 million of pre-tax earnings for the ICICI Prudential AMC stake, which is equivalent to maybe closer to $60 million post-tax.

In India, there are several asset managers listed which trade within a range of 15-30x consensus forward earnings. After the brokerage applies this range to Prudential's estimated earnings, it implies a potential valuation range for their stake of $0.9-1.8 billion.

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The firm said, "It is intended that following the completion of such a divestment, the net proceeds would be returned to shareholders. We will provide a further update at an appropriate time. India is a strategically important market for Prudential with compelling growth prospects."

"We will continue to explore opportunities to grow our businesses in the market. India is a strategically important market for Prudential with compelling growth prospects. We will continue to explore opportunities to grow our businesses in the market," Prudential added.

ICICI Bank tied up with Prudential in 1998 to form this 51:49 joint venture, which has lasted over 26 years. "We intend to retain our majority shareholding in ICICI Prudential Asset Management Company, ensuring our long-term commitment," said ICICI Bank in a stock exchange filing.

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