About the Company:
Star Health and Allied Insurance Company Ltd is the largest private health insurer in India with a market share of 15.8% in the Indian health insurance market in Fiscal 2021.
From being the first standalone health insurance (“SAHI”) company established in India in 2006, company has grown into the largest SAHI company in the overall health insurance market in India.
Company’s comprehensive health insurance product suite insured 20.5 million lives in Fiscal 2021 in retail health and group health.
Company has been consistently ranked first in the retail health insurance market in India based on retail health GWP (Gross Written Premium) over the last three Fiscal Years.
Company offers a range of flexible and comprehensive coverage options primarily for retail health, group health, personal accident and overseas travel, which accounted for 87.9%, 10.5%, 1.6% and 0.01%, respectively, of our total GWP in Fiscal 2021.
Distribution of health insurance policies.
Company distributes health insurance policies primarily through individual agents, which accounted for 78.9% of our GWP in Fiscal 2021.
Individual agents are the primary method of distribution in the health insurance industry, since health insurance is largely an assisted product in which customers often require help in selecting the policy best suited to their needs and during the claims process.
As of March 31, 2021, company had the largest number of individual agents among SAHI insurers, at approximately three times that of the SAHI company with the next highest number of agents.
Company’s Distribution network:
As of September 30, 2021 company’s distribution network had grown to 779 health insurance branches spread across 25 states and 5 union territories in India.
Company’s existing branches are also supplemented by an extensive network of over 562 Sales Managers Stations (“SMS”), which are small individual service centres, and over 6,892 in-house sales managers.
Company’s other origination channels include distribution by direct online sales through telemarketing, Company’s website, brokers, insurance marketing firms and web aggregators.
The following tables sets out GWP for retail health, group health, government health and personal accident and overseas travel for the periods indicated: (Rs. in million, except percentages)
Competition in the Business: (SAHI – Standalone health insurance companies)
Management Team:
- Mr. Venkatasamy Jagannathan (Designation: Chairman and CEO)
- Mr. Subbarayan Prakash (Designation: Managing Director)
Objectives of the Issue:
Offer for Sale: (Rs. 5249 cr)
- The proceeds of the Offer for Sale shall be received by the Selling Shareholders. Our Company will not receive any proceeds from the Offer for Sale.
Fresh Issue: (Rs. 2000 cr)
- to undertake our existing business activities.
- to undertake the activities proposed to be funded from the Net Proceeds.
Positives for the Company:
Successfully built one of the largest health insurance hospital networks in India.
- Company has successfully built one of the largest health insurance hospital networks in India, with 11,778 hospitals as of September 30, 2021.
- Out of the total number of hospitals in the network,company has entered into pre-agreed arrangements with 7,741 hospitals.
- Agreed hospital network enables company to monitor the quality of medical service provided to customers and provides access to competitive pricing at attractive, pre-negotiated rates, which lowers claims costs and increases customer engagement.
Largest private health insurance company in India with leadership in the attractive retail health segment.
- Company is the largest private health insurance company and the largest retail health insurance company in India by health GWP, with a 15.8% overall health insurance market share and a 31.3% retail health insurance market share in Fiscal 2021.
- As of March 31, 2019, 2020 and 2021, we issued 4.3 million, 5.1 million and 7.0 million health insurance policies, which was the highest among all health insurance providers.
Largest and well spread distribution networks in the health insurance industry.
- Company’s distribution network includes the largest branch network among non-public health insurance providers in India, included 779 health insurance branches spread across 25 states and 5 union territories in India.
Retail health market segment is expected to emerge as a key growth driver for the overall health insurance industry.
- The retail health market segment is expected to emerge as a key growth driver for the overall health insurance industry in India after the COVID-19 crisis in India due to low penetration of health insurance, high out-of-pocket expenses for healthcare costs and since only 10% of the population has insurance policies outside of government plans.
Financials of the Company:
| (in Crores) | FY 19 | FY 20 | FY 21 | 30th Sept 21 |
|---|---|---|---|---|
| Revenue | 226.2 | 461.9 | (907.7) | (494.6) |
| Net Profit | 128.2 | 268.0 | (-825.5) | (-380.2) |
Valuation of Peer Group Companies:
| Company Name | Face Value | EPS | PE Ratio | RoNW | NAV |
|---|---|---|---|---|---|
| Star Health and Allied Insurance Company Ltd |
10 | (16.54) | N.A | (-23.69%) | 63.58 |
| ICICI Lombard General Insurance Company Ltd |
10 | 32.41 | 46.66 | 19.81% | 163.56 |
| New India Assurance Company Ltd |
5 | 9.95 | 15.30 | 8.81% | 112.17 |
IPO Details:
| Details | Info |
|---|---|
| Issue Opens on | 30th November 2021 |
| Issue Closes on:. | 2nd December 2021 |
| Issue Price | Rs.870 – 900 |
| Face Value | Rs.10 |
| Retail Category Allocation | 10% |
| Minimum Lot | 16 Shares |
| Minimum Investment | Rs.14,400 |
| Issue Constitutes | 13.99% |
| Issue Size | Rs.7250 cr ($ 966 million) |
| Market Cap | Rs.51796 cr ($ 6.9 billion) |
| Listing at | NSE & BSE |
| Equity Shares Offered (Fresh) | 2,22,22,223 (Rs. 2000 cr) |
| Equity Shares Offered (OFS) | 58,324,225 (Rs.5250 cr) |
| Total Equity Shares Offered (Fresh + OFS) | 8,05,46,448 (Rs. 7250 cr) |
| Equity Shares Prior to the Issue | 55,32,89,944 |
| Equity Shares after the issue | 57,55,12,167 |
Also Read : List of Upcoming IPO’s in India.
Important Dates:
| Finalization of Basis of Allotment | on or Before 7th December 2021 |
| Initiation of Refunds | on or Before 8th December 2021 |
| Credit of Equity Shares: | on or Before 9th December 2021 |
| Listing Date: | on or Before 10th December 2021 |
Subscription Details:
| (Subscription-Category-Wise (no. of times) Till time : 06:00 PM) | Shares Offered | Day-1 | Day-2 | Day-3 |
|---|---|---|---|---|
| QIB | 2,38,30,602 | 0.00 | 0.07 | 1.03 |
| NII | 1,19,15,300 | 0.01 | 0.02 | 0.19 |
| Retail | 79,43,533 | 0.64 | 0.89 | 1.10 |
| Employee | 12,19,512 | 0.02 | 0.05 | 0.10 |
| TOTAL | 4,49,08,947 | 0.12 | 0.20 | 0.79 |
Note: Retail Subscription on the basis of Applications: 0.83x
IPO Valuation Parameters:
| Earnings Per Share (EPS) | Price To Earnings ratio (PE) | Return on Net Worth (RoNW) | Net Asset Value (NAV) |
|---|---|---|---|
| (-16.54) | N.A | (-23.69%) | 63.58 |
| Check IPO Allotment Status: |
|---|
KfinTech Website : http://kfintech/IPO/Allotment_StatusBSE IPO Website: https://www.bseindia.com/IPO/Allotment |
| Company Contact Info: |
|---|
| Star Health and Allied Insurance Company Limited No.1,New Tank Street Valluvarkottam High Road Nungambakkam, Chennai Tamil Nadu 600 034 India. Tel: +91 44 2828 8800 E-mail: investors@starhealth.in Website: www.starhealth.in |
| IPO Registrar Info: |
|---|
| KFin Technologies Private Limited Selenium, Tower B, Plot No- 31 and 32 Financial District, Nanakramguda, Serilingampally, Hyderabad Rangareedi 500 032 Telangana, India Tel: +91 40 6716 2222/ 180034 54001 E-mail: starhealth.ipo@kfintech.com Website: www.kfintech.com |
