Rakesh Jhunjhunwala-Backed Star Health Makes Tepid Debut On Bourses, Lists At 6 Per Cent Discount

Star Health’s Rs 7,250-crore IPO had just about managed to sail through despite a poor response from investors, garnering just 79 per cent subscription during November 30-December 2

Rakesh Jhunjhunwala is the promoter of Star Health. Image: Getty

New Delhi: Ace Investor Rakesh Jhunjhunwala-backed Star Health and Allied Insurance Company (Star Health) made a tepid debut on the bourses on Friday, with its equity shares getting listed at Rs 845, a 6 per cent discount to its issue price of Rs 900 per share on the National Stock Exchange (NSE). On the BSE, the stock opened at Rs 848.80, according to the exchange data.

The initial public offering (IPO) of Star Health failed to get fully subscribed last week, signaling weak investor demand.

Star Health’s Rs 7,250-crore IPO, the third-largest this year and eighth-largest ever, had just about managed to sail through despite a poor response from investors, garnering just 79 per cent subscription during November 30-December 2.

Rakesh Jhunjhunwala is the promoter of Star Health — India’s first and largest private health insurance firm. He owns nearly 15 per cent stake in the insurer, did not put up any shares for sale in the IPO.

Founded in 2006, Star Health offers coverage options for retail health, group health, personal accidents and overseas travel insurance.

According to Reuters, Ajit Mishra, vice-president, research, Religare Broking, said, “Considering the undersubscription of the issue, the flat listing of Star Health was expected. The financial performance was impacted in FY21 (2020-21), but long-term growth prospects of the industry remain quite promising.”

Meanwhile, Rakesh Jhunjhunwala-backed another company, footwear retailer Metro Brands, on Thursday said it has collected a little over Rs 410 crore from anchor investors ahead of its IPO roll-out on Friday.

The company has allotted 82.05 lakh equity shares to anchor investors at Rs 500 apiece, taking the total transaction size to Rs 410.25 crore, according to a BSE circular.  

The initial share-sale comprises fresh issuance of equity shares worth Rs 295 crore and an offer for sale of 2.14 crore equity shares by promoters and other shareholders.