Star Well being and Allied Insurance coverage Co. Ltd, backed by billionaire inventory dealer Rakesh Jhunjhunwala, made a weak inventory market debut on Friday after a tepid investor response to its preliminary public providing in an in any other case sturdy 12 months for India’s major market.
The inventory listed at a reduction however closed marginally larger than the IPO worth. It began buying and selling at ₹848.80 on BSE, 5.8% decrease than the IPO worth of ₹900. In the course of the day, the inventory swung between a excessive of ₹940 and a low of ₹827.50, earlier than ending buying and selling at ₹906.85, a rise of 0.76% from the problem worth.
“We consider Star will proceed to develop at a sooner tempo than trade. Nonetheless, we discover valuations at an costly finish from a near-term perspective, not leaving a lot upside on the desk. As well as, hospitalization of non-covid circumstances could possibly be a damaging shock in forthcoming months,” Aditya Birla Capital stated in a word.
Poor investor response pressured Star Well being to chop its supply on the market measurement to ₹4,400 crore from ₹5,249.18 crore. The recent situation measurement was stored unchanged at ₹2,000 crore. Subsequently, the overall IPO measurement was lowered to ₹6,400 crore from ₹7,249 crore.
Final week, retail traders positioned bids for only one.08 occasions the shares reserved for them. Non-institutional traders bid for 0.18 occasions their quota, whereas institutional traders subscribed 1.03 occasions.
Safecrop Investments India LLP offered 29.85 million shares within the IPO, towards 30.68 million shares deliberate beforehand. Apis Development 6 Ltd offered 4.34 million shares, decrease than its earlier plan of seven.68 million shares, Mio IV Star 3.83 million shares (4.11 million earlier), College of Notre Dame DU LAC 5.63 million shares (7.44 million earlier), Mio Star 2.49 million shares (4.11 million earlier), and ROC Capital 1.4 million shares (2.51 million earlier).
Star Well being has now develop into India’s fourth publicly listed personal sector insurance coverage firm. The others are HDFC Life Insurance coverage Co. Ltd, ICICI Prudential Life Insurance coverage and ICICI Lombard Basic Insurance coverage. The listed state-run insurers embrace SBI Life Insurance coverage, Basic Insurance coverage Co. of India and New India Assurance Co. Ltd.
Star Well being is India’s high personal well being insurer, with a market share of 15.8% and a complete gross written premium (GWP) of ₹93.49 billion in FY21. It gives versatile and complete protection choices primarily for retail well being, group well being, private accident and abroad journey, which accounted for 87.9%, 10.5%, 1.6% and 0.01%, respectively, of its complete GWP in FY21. It has issued seven million medical insurance insurance policies since inception, processing round six million claims.
Star Well being has constructed one of many largest medical insurance hospital networks in India, with greater than 10,870 hospitals. Out of this, it has entered into pre-agreed preparations with greater than 7,000 hospitals, or 64.9%, of the overall variety of hospitals in its community, and has processed 0.33 million claims, or 55.0% of its complete variety of cashless claims, by means of agreed community hospitals.
It has greater than 12,800 staff and over 640 department workplaces throughout India.
Throughout FY21, Star Well being’s complete earnings elevated to ₹7,405.32 crore from ₹5,453.78 crore within the earlier 12 months. Web loss, nevertheless, widened to ₹825.58 crore from ₹268 crore through the interval because the pandemic led to a rise in buyer claims.
Supply: Live Mint