PB Fintech shares rebound 4% after 36% crash; HSBC, Motilal flag regulatory risks

According to fresh market updates, PB Fintech shares rebounded in early session on Friday, September 25, rising 4 percent to Rs 1,256 after the Policybazaar parent suffered a 36 percent crash in the previous session amid concerns over proposed changes to insurance distribution commissions. The recovery came as the broader market traded largely flat. At 9:19 am, the Sensex was up 0.13 percent at 73,676.61, while the Nifty 50 advanced 0.08 percent to 23,080.95.

Despite Friday's rebound, PB Fintech stays down around 31 percent in 2026, compared with an 11.7 percent slide in the Nifty 50. Its market capitalisation stood at around Rs 57,300 crore. The stock had plunged to a 52-week low on Thursday after the Insurance Regulatory and Development Authority of India (IRDAI) proposed commission caps and other changes to insurance distribution economics, raising concerns over the impact on Policybazaar's topline and earnings.

Following the proposals, HSBC downgraded PB Fintech to 'Hold' and trimmed its target price sharply to Rs 1,150 from Rs 2,100. The brokerage lowered its FY28 and FY29 earnings per share estimates by 56 percent and 17 percent, respectively, saying the proposed reforms could have a material impact on the firm.

Motilal Oswal maintained a 'Neutral' rating with a target price of Rs 1,150. It estimated that the proposed changes could reduce PB Fintech's FY28 core online insurance topline by around 30 percent. Without cost or other topline offsets, the brokerage stated this could translate into a 46 percent trimmed to earnings estimates. Motilal Oswal stated the stock could stay under pressure until the final regulations are announced, keeping regulatory clarity central to PB Fintech's near-term outlook.

Share Markets Live Updates | Sensex, Nifty, GIFT Nifty Today

Thursday's 36 percent collapse wiped out more than Rs 31,000 crore from PB Fintech's market capitalisation in a single session. Friday's early rebound recouped only a fraction of that decline, with the stock still trading around 34 percent below Wednesday's closing level despite the 4 percent recovery.

The IRDAI proposals seek to link commissions more closely to product complexity and the effort required to sell insurance, while prescribing softer payouts for products distributed through open-architecture channels such as brokers and banks. In health insurance, commissions on renewals and porting are proposed to be capped at 5-10 percent, while first-year commissions on life insurance would be capped at 5-20 percent depending on the policy tenor.