Anil Ambani, known for mega size IPOs, is eyeing the insurance sector this time. He wants his six-year old Reliance Life Insurance to list. But this time the younger Ambani's market plans hinges on government approval.

Ambani now wants to unlock the value of his life insurance venture by going public.

Sources told NDTV that the company has already begun the due diligence process and bankers are working on the valuations.

Reliance Insurance's valuation is seen at Rs 10,000- Rs12,000 crore and the company plans to dilute 5-10 per cent stake. It has Rs 2,500 crore as its capital employed.

But, it is facing a major hurdle on the regulatory front.

The IRDA norms require a minimum of 10 years in the business before any life insurance company can go for an IPO. However, IRDA appointed standing committee is looking at scrapping section 6AA in the insurance bill dealing with this aspect and IRDA is also expected to come out with an IPO framework for companies very soon.

Robin Roy, associated director at PwC, said, “Insurance companies will look at tapping the market, but need more clear guidelines on this aspect.”

Amendment to the insurance bill could be a time consuming and complex process. Hence to speed up its approval, Reliance Insurance has approached the finance ministry for a waiver, which sources say, can be done by getting a cabinet approval.

Meanwhile, Reliance group, which is known for having its way out in whatever they do, is in all likelihood to get this waiver from the finance ministry. This may actually help PSU insurance players like SBI to look at option of IPO on one hand and on the other pay the way for life insurance companies to set the ball rolling in unlocking their value.