India’s biggest private health insurer, Star Health and Allied Insurance Company Ltd., was founded in 2006 and has a market share of 15% in Fiscal 2021. The retail health and group health sectors account for 89.3% and 10.7% of the total GWP in Fiscal 2021, respectively, of the company’s business.
However, it also uses corporate agent banks and other corporate agents to disseminate its policies. As of September 30th, 2021, it will have 779 branches throughout India’s 25 states and 5 union territories. In addition, Star Health has created one of India’s biggest health insurance hospital networks, with a total of 11,778 facilities.
Strengths in the marketplace
Largest private health insurance firm in India and leader in the lucrative retail health industry.
The health insurance industry’s widest network of providers.
Diversified product line focusing on innovation and customized items.
Exceptional risk management and excellent client service.
A proven track record of financial and operational success.
Promoters of a business:
Company founders are Safecrop Investments India LLP, Westbridge AIF I, and Rakesh Jhunjhwala.
a brief overview of the financial situation of the business (Restated Consolidated)
Emission of Shares in Star Health Insurance Company, Inc.
|IPO Open:|| 30 November 2021|
|IPO Close:|| 02 December 2021|
|IPO Size:||Approx ₹7249 Crores|
|Fresh Issue:|| Approx ₹2000 Crores|
|Offer for Sale:|| Approx 58,324,225 Equity Shares|
|Face Value:|| ₹10 Per Equity Share|
|Price Band:||₹870 to ₹900 Per Share|
|Listing on:||BSE & NSE|
|DRHP Draft Prospectus:|| Click Here|
|RHP Draft Prospectus:|| Click Here|
According to analysts, Star Health and Allied Insurance Company, which is funded by Rakesh Jhunjhunwala, is expected to make its stock market debut on December 10 at a discount, but there may be some purchasing later in the day.
The IPO desk’s mood was dampened by a lower IPO subscription and a higher valuation, which might have an impact on the stock’s listing price.
As of November 30-December 2, only 79 percent of the health insurer’s first-ever public issuance was subscribed, while the share reserved for qualified institutional purchasers was completely subscribed (1.03 times). Unless it is a new offering, the IPO must get at least 75% subscription and the QIB part must receive at least 90% subscription before it may go forward.
A smaller offer was made available to those who didn’t get their shares in time for closure. It’s been reduced from Rs 7,249 to Rs 6,400.44 billion in the final issue due to the additional issuance of Rs 2,000 billion and the offer-for sale of Rs 4,400.44 billion as opposed to Rs 5,249 billion before.
Non-institutional investors and workers made up 19% and 10% of the total subscriptions, whereas retail investors made up 1.1 times the total subscriptions. Most investors’ subscriptions are almost filled, as seen by the undersubscription.
Similarly, Mehta Equities’ Vice-President (Research) Prashant Tapse thinks the same way about this. With unpredictable market circumstances and lower than projected IPO subscription demand, the listing mood may be harmed, he said.
“Risk worries outweigh the benefits of investing, thus investors should anticipate a lower listing price. The ask value seems to be on the high side and there is nothing left on the table for authorized investors at the top price range.”
The IPO price has been set at Rs 900 per share by the firm. Experts believe that the undersubscription of the reserved part for workers is also a negative factor for the stock’s listing. A total of 1,12,592 equity shares were reserved for the company’s workers, each of whom received an 80 rupee discount off the final offer price of Rs 820 per share.
An undersubscribed share earmarked for non-institutional investors (NIIs) and workers is a bad sign for the company. Because of the GMP and the number of recently listed IPOs, we may see the Star Health IPO open at a discount,” said CapitalVia’s Head of Research, Gaurav Garg.
According to IPO Central, shares of Star Health traded on the grey market for Rs 840, a markdown of Rs 60 or 6.7% off the final offer price of Rs 900 per share. In addition, IPOWatch and IPOBAZAR reported a lower grey market pricing for Star Health.
The grey market is an unofficial marketplace where IPO shares are traded before they are officially listed on stock exchanges, beginning with the release of the price band.
Analyst Astha Jain of Hem Securities believes the stock will initially trade at a lower level than the issue price, but expects it to rise over time.
With a market share of 15.8 percent, Star Health claims to be India’s biggest private health insurance. It had gross written premiums of Rs 9,348.95 crore in FY21 and Rs 5,069.78 crore in the six months that ended in September 2021.