Acko heads for IPO with $2.5B valuation goal
What's the story
Acko, a leading insurance start-up based in Bengaluru, has appointed ICICI Securities, Morgan Stanley and Kotak Securities as the book-running lead managers for its initial public offering (IPO). The firm plans to file its draft red herring prospectus (DRHP) with the Securities and Exchange Board of India (SEBI) in the coming months. Acko is targeting a valuation between $2-2.5 billion for this public offering, which is expected to be a combination of fresh issue and offer for sale.
Company growth
Acko's journey and expansion into health insurance
Founded in 2016 by Varun Dua, Acko started its journey in the direct-to-consumer (D2C) auto insurance space. In March 2023, the company expanded into retail health insurance and acquired Parentlane to further its health business. Today, it has partnerships with PhonePe and MyGate for offering comprehensive insurance products directly on their platforms. It also has over 50 platform partnerships including Oyo, RedBus, and Zomato for embedded insurance offerings.
Market impact
Impressive growth and revenue milestones
Acko claims to have distributed insurance policies to over 78 million unique customers and issued more than one billion insurance policies so far. In FY25, the company reported a revenue of ₹2,837 crore, a whopping 35% increase from the previous year. This growth rate is significantly higher than the sub-10% growth seen in the broader insurance sector during this period.
Financials
Reduction in net losses and funding history
Acko has also managed to cut its net losses by 37% year-on-year. The insurtech firm has raised some $450-460 million from investors such as General Atlantic, Accel, Elevation Capital and FPGA family foundation, among others. These funds have helped Acko grow and expand its range of insurance products over the years.