Shares of Star Health and Allied Insurance Co Ltd fell over 7 percent on May 26 after a huge block deal where 7.37 million shares or 1.3 percent stake of the company changed hands in a bunch of trades, Bloomberg reported. However, the details of the buyers and sellers were not known.
The stock hit a low of Rs 539.20 on BSE and declined as much as 7.66 percent intraday. At 10.37 am, the scrip was trading at Rs 547 on BSE, down 6.33 percent from its previous close.
Recently, the company posted a standalone net profit of Rs 102 crore for the quarter ended March 2023 against a net loss of Rs 82 crore for the year-ago period. Gross Written Premium (GWP) increased by 14 percent to Rs 4,199 crore in the March quarter. It reported a solvency ratio of 2.14 against the minimum requirement of 1.5 during the quarter.
The retail health premium sector grew by 18 percent to Rs 11,948 crore, while its market share stood at 34 percent in the Indian general insurance industry.
"Given levers for improvement in RoE – strengthening of distribution channels through banca tie-up, focus on profitable growth, elevated yields and issuance of Esop at market price, we remain positive on the fundamental strength. Thus, we assign a multiple of 2x on FY25E GDPI and arrive at a revised target price of Rs 700 from Rs 650 earlier," ICICI Direct said in its recent note.
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