There are 19 life insurance companies in Nepal. Union Life Insurance Company was established in 2074 B.S under company Act 2063 and insurance Act 2049. Jagadamba group, Golcha Group, Gadiya group, and other reputed business houses have the major investment in union life insurance. Also, It is a solo Nepalese life insurance company limited. Firstly, providing services with total security is the mission statement of union insurance. Likewise, becoming the big life insurance company of Nepal in terms of premium income, a number of policies, profit, and a high rate of return to its shareholders are the main goal of this insurance company.
Union Life insurance is collaborating their reinsurance with Nepal Re-Insurance Company Limited and Ocean Re-Insurance. There is four-person in Board of Director including the chairman. Also, they have 17 members of a dynamic and well-known management team.
Table of Contents
Financial Performance
Financial indicators are true benchmarks to investors to invest in companies. Union life insurance started its journey from 2074/06/04 BS in the Nepalese insurance business. They started making a profit in 2075 BS. The major financial indicators are highlighted below:
| S.N | Heading | 2076/077 | 2077/078 | Estimated 2078/79 |
| 1 | Paid-up-capital | 1,505,000,000.00 | 2,150,000,000.00 | 2,150,000,000.00 |
| 2 | Reserve | 656,455,070.00 | 706,679,170.00 | 827,233,520.00 |
| 3 | Outstanding Shares | 15,050,000 | 21,500,000 | 21,500,0000 |
| 4 | Net worth per Share | 148.46 | 136.52 | 142.75 |
| 5 | Earnings Per Share | 33.33 | 4.17 | 6.23 |
| 6 | Paid-up value | 100 | 100 | 100 |
| 7 | Net worth Return | 22.45% | 3.05% | 4.36% |
This insurance company can give good returns to its shareholders in the future. So, union insurance is good for long-term purposes.
Ownership Structure
| Shareholder Types | Number of Shares | Percentage of Ownership | Authorized Amount (RS) |
| Promoter Shares | 15,050,000 | 70% | 1,505,000,000.00 |
| General Public | 6,450,000 | 30% | 6,45,000,000.00 |
IPO Details
Currently, many life and non-life insurance companies are issuing their shares to the general public in terms of IPO. Here, all the IPO details of Union Life Insurance Company Limited are as follows:
IPO Open Date : 2078 Ashad 24
IPO Close Date (Early) : 2078 Ashad 28
IPO Close Date (Late) : 2078 Sharwan 07
IPO for Union Life Insurance Employee : 3,22,500 Shares
IPO for Mutual Funds : 3,22,500 Shares
IPO for General Public : 58,05,000 Shares
Total amount of Shares : Rs 64,50,00,000
ICRANP Rating : BBB” (Moderate Safety Regarding Timely Servicing of Financial Obligations)
Price Per Share : Rs 100
Issue Capital : Prabhu Capital Limited
How to Apply? : Through Mero share and C-ASBA
In the last 1 year, IPOs in Nepal are oversubscribed. In every IPO more than 2 million people apply for general shares. Low risk with high profit is the major reason for being IPO oversubscribed. So, I recommend all the investors to apply for 10 Kitta.
Investment Strategy
Union life Insurance will collect the amount of Rs 64.5 crore by issuing IPO. They already made the proper portfolio plan for those amounts. They are going to invest in the following areas:
| S.N | Investment Heading | Percentage | Amount |
| 1 | Nepal government’s Debenture/ Development Debenture | 25% | 161,250,000 |
| 2 | Fixed Deposit in Commercial Bank | 40% | 258,000,000 |
| 3 | Fixed Deposit in Development Bank | 15% | 96,750,000 |
| 4 | Fixed Deposit in Finance Companies | 10% | 64,500,000 |
| 5 | Stock of public Limited company | 10% | 64,500,000 |
Conclusion
Finally, Union Life Insurance company Limited has good paid-up capital and promoted by well-known business houses of Nepal. Also, they have a profitable insurance policy, and they insured by the safest re-insurance company. Therefore, many people will apply for this share, and it is going to be oversubscribed. So, it will be allotted by lucky draw.