Star Health IPO: Rakesh Jhunjhunwala backed issue to open on Tuesday

On Tuesday, Star Health & Allied Insurance Company (Star Health) will launch an initial public offering (IPO) for Rs 7,249 crore.

A fresh issue of Rs 2,000 crore is in the cards, as well as an offer for sale of 5.83 lakh shares in the Rs 870-900 price range. The company is valued at almost 5.9 times its assets under management (AUM) as of September 30 at the upper end of the price band. A ten percent retail quota has been set aside.

Star Health, the country’s largest private health insurance, is controlled by a group of investors including Westbridge Capital and Rakesh Jhunjhunwala.

According to the red herring prospectus, the proceeds from the new offer will be utilised to increase the company’s capital base and maintain solvency levels (RHP).

Investors interested in subscribing to the Star Health IPO might do so in lots of 16 equity shares and then in multiples. They would pay Rs 14,400 for a single lot of Star Health and Allied Insurance Company at the top of the price scale. Both the BSE and the National Stock Exchange will list the shares (NSE).

Applicants should also keep in mind that the deadline for UPI mandate confirmation is December 3, 2021, at 12:00 p.m. If they do not comply, their application may be rejected.

“Due to the Covid pandemic, awareness in the health insurance sector has increased, and the retail health market segment is expected to emerge as a key growth driver for the overall health insurance industry in India,” Ravi Singh, VP and Head of Research at Share India Securities, said of the upcoming IPO.

He went on to say that the health insurance business has a bright future, and that with only two publicly traded general insurance companies – ICICI Lombard and New India Insurance – he believes Star Health would be a smart long-term investment.

According to the RHP, the share allotment is planned to take place on December 7, 2021, and the shares are expected to be listed on December 10, 2021.

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