Shares of Star Health and Allied Insurance fell over 6 percent on October 30 after the company reported over 11 percent drop in its net profit for the September quarter.
The insurance company reported decline of 11.18 percent in its net profit for the September quarter of the current fiscal at Rs 111.29 crore. Previously, the company reported Rs 125.30 crore in the same quarter a year ago.
The stock reacted sharply to the decline in net profit with the counter dropping 6.63 percent to its day's low of Rs 500.65 on the NSE. At around 10:30 am, the stock was trading at Rs 503.65, down by 6.08 percent.
The sales of the company rose 15.54 percent to Rs 3,703.88 crore in the quarter ended September 2024 as against Rs 3,205.58 crore during the previous quarter ended September 2023.
The net earned premium (NEP) was up 16 percent at Rs 3,704 crore for the quarter under review against the brokerage estimates of Rs 3,667 crore.
The H1FY25 combined ratio stood at 101.06 percent. The management in an earnings call said that it will be difficult to achieve the FY25 guidance on the combined ratio.
"The industry is facing shift in consumer behaviour post Covid. The company is planning to take price hikes beyond what was planned," it said.
The management expects lower impact of seasonality in both the remining two quarters of the current fiscal based on the historical trends. "Target to reach premium income to Rs 18,000 crore can be achieved in FY25," they said.
Earlier in September, Star Health had filed a lawsuit against Telegram and a hacker. According to the lawsuit, chatbots on Telegram were being used to leak personal data and medical reports of about 3 crore Star Health policyholders.
Rekha Jhunjhunwala holds over 1.78 crore or 3 percent stake in Star Health and Allied Insurance Company Ltd. worth Rs 896.5 crore, as per September 2024 data.
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