Star Health is the market leader in the Indian Insurance Industry. The company’s market share in retail is 31 percent.
Rakesh Jhunjhunwala portfolio insurance Stock: There is a recovery in the stock market. However, the situation of uncertainty also remains regarding the Russia and Ukraine crisis. Worldwide inflation has increased and crude is still close to $100 per barrel. However, the long term outlook for the market is better, and at such times experts are advising to add quality stocks to the portfolio. If you are also looking for such a good stock, then you can keep an eye on Star Health and Allied Insurance Company included in Rakesh Jhunjhunwala’s portfolio. Brokerage house Motilal Oswal has given investment advice while introducing coverage in the stock.
Growth prospects in the health insurance sector
The brokerage house says that Star Health is the market leader in the Indian insurance industry. The company’s market share in retail is 31 percent. Star Health is growing faster than the overall health insurance industry. The reach of the Indian health insurance industry is still not very high in the country. Its penetration is very less compared to countries like China or America. Its penetration and density in the country is 0.4 percent and $5. Whereas in China and America it is 0.7% / 4.1% and $ 66 / $ 2679. In such a situation, rapid growth is expected in the health insurance industry. Till now only 3.5 percent of the population in the country is covered by health insurance.
Strong company network
Star Health has increased the market share from 40 percent to 50 percent in the last 5 years. The company is benefiting from its focus on single product, strong agency network and strong association with hospitals. The company’s market share is estimated to increase by 32 percent to 1 crore in FY22. The company has 5.3 lakh agents, 786 branches and tie-ups with over 12,000 hospitals. The company is a market leader in specialty products such as Cancer, Cardiac, Senior Citizens and Diabetes.
Shares can go up to Rs 750
The brokerage believes that the gross premium CAGR of the company will be 25% till FY21-24E. Whereas after a loss of 830 crores in FY21 due to COVID, the company’s PAT will be Rs 1080 crores till FY24E. The brokerage house has given a target of Rs 750 while advising to buy in the stock. The current price of the stock is Rs 609, so it has a possible return of 23 per cent.
Rakesh Jhunjhunwala has 100,753,935 shares
Rakesh Jhunjhunwala holds 17.5 per cent stake in the company. The company has 100,753,935 shares in his portfolio. Star Health was listed on the stock market on 10 December 2022. The issue price for the IPO was Rs 900, while the stock got listed at Rs 903. On the listing day, after seeing a price of Rs 940, it closed at Rs 907.
(Disclaimer: Stock investment advice is given by the brokerage house. These are not the personal views of The Financial Express. Markets are risky, so take expert opinion before investing.)
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