The stock of Star Health was listed on December 10, 2022 and since then it has seen a steady decline. The stock has made huge losses for the veteran investor Rakesh Jhunjhunwala.
Rakesh Jhunjhunwala Portfolio Stock: Rakesh Jhunjhunwala, a veteran investor in the stock market, is considered an expert in identifying multibagger stocks. There are more than one stock in his portfolio, in which apart from him, investors have also made a lot of money. But one of his favorite shares, Star Health & Allied Insurance Company, has caused a lot of loss to Rakesh Jhunjhunwala. This stock was listed on December 10, 2022 and after that in about 2 months till now it has seen a steady decline. In this fall, Rakesh Jhunjhunwala has also lost about Rs 2115 crore in Star Health. However, brokerage house Emkay Global expects a rise in the stock going forward.
Big Bull shock after listing
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. At the same time, in the business of today i.e. February 14, it came down to Rs 730 with a big drop. That is, there has been a weakness of Rs 210 since the record high in the stock.
Rakesh Jhunjhunwala holds 17.5 per cent stake in the company. The company has 100,753,935 shares in his portfolio. Calculating from the weakness of Rs 210 per share, then the value of this share in his portfolio has decreased by about Rs 2115 crore and now it has remained around 7395 crore.
Why is the stock under pressure?
Brokerage house Emkay Global says that Star Health’s results in Q3FY22 have been weak. The claim ratio in the December quarter stood at 105 per cent, while the combined ratio stood at 135 per cent. The company has incurred a loss of Rs 570 crore in these 3 months. Apart from COVID 19 hospitalization, the performance of the company has been affected due to non-covid 19 claims raised. Although now the cases of COVID 19 are decreasing, the hospitalization rate is very low. At the same time, the company is going to launch some more products in the future. Due to which the business of the company will be normal in the financial year 2023.
Better outlook for the future
The company is also working on product pricing and operating expenses. The company’s past track record has been good, the company has a good hold in the retail health market, hence Star Health’s business outlook is strong in the long term. The brokerage has given buy advice in the stock with a target of Rs 1040. With the current price of Rs 730, 42% return is possible in this.
(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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