Billionaire investor Rakesh Jhunjhunwala-backed Star Health and Allied Insurance Company's share sale via initial public offering (IPO) will begin on November 30, 2021, according to information on the stock exchanges. Star Health is planning to raise Rs 7,249.18 crore from the IPO which consists of an offer for sale by existing promoters and shareholders worth Rs 5,249.18 crore and fresh issue of Rs 2,000 crore.
Under the offer for sale, its promoter Rakesh Junjhunwala will not be selling his shares in the IPO. However, its other promoters like Safecrop Investments India LLP will be offloading up to 3.06 crore shares and 1.37 lakh shares will be sold by Konark Trust.
MMPL Trust, APIS Growth 6, MIO IV Star, University Of Notre Dame, MIO Star, Venkatasamy Jagannathan, Sai Satish and Berjis Minoo Desai are also among the selling shareholders in the IPO, according to its prospectus.
The company is planning to sell shares in the price band of Rs 870-900 per share and a retail investor can bid for minimum one lot of 16 shares up to maximum of 13 lots. At the upper price band, one lot of Star Health shares will cost Rs 14,400. The stock was quoting at premium of Rs 156 per share in the grey market, according to market participants.
The objective of the IPO is to utilize the net proceeds to augment the company's capital base and insolvency level.
Star Health and Allied Insurance Company is one of the largest private health insurers in India with a market share of 15.8 per cent in financial year 2021. The company primarily focuses on the retail health market segment. It offers a range of flexible and comprehensive coverage options for retail health, group health, personal accident, and overseas travel, accounting for 87.9 per cent, 10.5 per cent, 1.6 per cent, and 0.01 per cent, respectively.
Ambit Private, Axis Capital, BofA Securities, Citigroup Global Markets India, CLSA India, Credit Suisse Securities, DAM Capital Advisors, ICICI Securities, IIFL Securities, Jefferies India, Kotak Mahindra Capital Company and SBI Capital Markets are the lead managers for Star Health IPO while KFintech is the registrar to the issue.