Two companies Star Health and Allied Insurance Company and Tega Industries will float their initial public offerings (IPOs) this week to collectively raise Rs 7,868 crore.
The three-day initial share-sale of Rakesh-Jhunjhunwala backed private insurance company Star Health will open on November 30 and conclude on December 2, while that of Tega Industries will be open for public subscription from December 1 to 3. The two IPOs come after 10 firms concluded their initial public offerings in November. So far in 2021,51 companies have launched IPOs to raise over Rs 1 lakh crore.
Star Health’s public offer consists of fresh of equity shares worth Rs 2,000 crore and an offer for sale (OFS) of up to 58,324,225 equity shares by promoters and existing shareholders. Star Health has fixed a price band of Rs 870-900 a share and at the upper end of the price band. Star Health plans to raise Rs 7,249 crore through the offer at the upper end of the price band. The company through the OFS part will look to raise an offer size of Rs 5,249 crore during the three-day bidding process.
Currently, Safecrop Investments India LLP has a 47.77% stake, while Rakesh Jhunjhunwala and his wife Rekha Jhunjhunwala hold 14.98% and 3.23% stake, respectively, in the company. The proceeds from the issue will be used towards the augmentation of its capital base.
The proposed IPO will make Star Health the fourth private sector insurance provider to list on Indian stock exchanges, following HDFC Life Insurance Co. Ltd, ICICI Prudential Life Insurance and ICICI Lombard General Insurance. With a market share of 15.8 percent, Star Health is the largest private health insurer in the Indian health insurance market. In FY21 and first half of FY22, it had total gross written premium (GWP) of Rs 9,348.95 crore and Rs 5,069.78 crore, respectively.
“The retail health market segment is expected to emerge as a key growth driver for the overall health insurance industry in India after the pandemic due to a low penetration of health insurance and high out-of-pocket expenses for healthcare costs, the document said.
Investors can bid for a minimum of 16 equity shares and in multiples of 16 shares thereafter. Retail investors can invest a minimum of Rs 14,400 for a single lot, and their maximum investment would be Rs 1,87,200 for 13 lots (208 equity shares).
Meanwhile, Tega Industries, manufacturer of consumables for the mining industry, has fixed a price band of Rs 443-453 a share for its Rs 619-crore initial share-sale. The IPO is purely an offer of sale 1,36,69,478 equity shares by promoters and a existing shareholder. Currently, promoter and promoter group hold 85.17 per cent stake in the company and US-based Wagner owns 14.54 per cent shareholding.
As a part of the offer for sale, promoters Madan Mohan Mohanka will offload up to 33.14 lakh equity shares and Manish Mohanka will sell 6.63 lakh equity shares. Wagner, an affiliate of the US-based private equity firm TA Associates, will offload 96.92 lakh equity shares through the offer for sale.
A bidder of this public issue will be able to apply in lots and one lot will comprise 33 shares of the company. One bidder will be able to apply for maximum 13 lots.
“Bidder are advised to keep an eye on the Indian and global markets as new corana variant has hit global bourses very badly. If NSE Nifty goes below 17,000 in next week session, then the public issue will become available for subscription in a bear-hit market. In that case, 100 per cent OFS of the public issue might play a hurdle,” cautioned Avinash Gorakshkar, Head of Research at Profitmart securities.
Both the offerings are set to test investors’ appetite just as digital payments startup Paytm slumped more than 30% in the first three days of trade after raising $2.5 billion in India’s biggest-ever IPO. Several expected listings are now under a close watch as investors question valuations for the country’s startups.
The fund raising so far this year is much higher than Rs 26,611 crore collected by 15 companies through initial share sale in all of 2020. October and November saw Rs 37,000 crore being raised through the IPO route with Paytm accounting for half of that amount. 2021 is already a record year for IPOs, beating 2017 by a margin, and there is still one month to go, with a number of mega issues lined up.
The three-day initial share-sale of Rakesh-Jhunjhunwala backed private insurance company Star Health will open on November 30 and conclude on December 2, while that of Tega Industries will be open for public subscription from December 1 to 3. The two IPOs come after 10 firms concluded their initial public offerings in November. So far in 2021,51 companies have launched IPOs to raise over Rs 1 lakh crore.
Star Health’s public offer consists of fresh of equity shares worth Rs 2,000 crore and an offer for sale (OFS) of up to 58,324,225 equity shares by promoters and existing shareholders. Star Health has fixed a price band of Rs 870-900 a share and at the upper end of the price band. Star Health plans to raise Rs 7,249 crore through the offer at the upper end of the price band. The company through the OFS part will look to raise an offer size of Rs 5,249 crore during the three-day bidding process.
Currently, Safecrop Investments India LLP has a 47.77% stake, while Rakesh Jhunjhunwala and his wife Rekha Jhunjhunwala hold 14.98% and 3.23% stake, respectively, in the company. The proceeds from the issue will be used towards the augmentation of its capital base.
The proposed IPO will make Star Health the fourth private sector insurance provider to list on Indian stock exchanges, following HDFC Life Insurance Co. Ltd, ICICI Prudential Life Insurance and ICICI Lombard General Insurance. With a market share of 15.8 percent, Star Health is the largest private health insurer in the Indian health insurance market. In FY21 and first half of FY22, it had total gross written premium (GWP) of Rs 9,348.95 crore and Rs 5,069.78 crore, respectively.
“The retail health market segment is expected to emerge as a key growth driver for the overall health insurance industry in India after the pandemic due to a low penetration of health insurance and high out-of-pocket expenses for healthcare costs, the document said.
Investors can bid for a minimum of 16 equity shares and in multiples of 16 shares thereafter. Retail investors can invest a minimum of Rs 14,400 for a single lot, and their maximum investment would be Rs 1,87,200 for 13 lots (208 equity shares).
Meanwhile, Tega Industries, manufacturer of consumables for the mining industry, has fixed a price band of Rs 443-453 a share for its Rs 619-crore initial share-sale. The IPO is purely an offer of sale 1,36,69,478 equity shares by promoters and a existing shareholder. Currently, promoter and promoter group hold 85.17 per cent stake in the company and US-based Wagner owns 14.54 per cent shareholding.
As a part of the offer for sale, promoters Madan Mohan Mohanka will offload up to 33.14 lakh equity shares and Manish Mohanka will sell 6.63 lakh equity shares. Wagner, an affiliate of the US-based private equity firm TA Associates, will offload 96.92 lakh equity shares through the offer for sale.
A bidder of this public issue will be able to apply in lots and one lot will comprise 33 shares of the company. One bidder will be able to apply for maximum 13 lots.
“Bidder are advised to keep an eye on the Indian and global markets as new corana variant has hit global bourses very badly. If NSE Nifty goes below 17,000 in next week session, then the public issue will become available for subscription in a bear-hit market. In that case, 100 per cent OFS of the public issue might play a hurdle,” cautioned Avinash Gorakshkar, Head of Research at Profitmart securities.
Both the offerings are set to test investors’ appetite just as digital payments startup Paytm slumped more than 30% in the first three days of trade after raising $2.5 billion in India’s biggest-ever IPO. Several expected listings are now under a close watch as investors question valuations for the country’s startups.
The fund raising so far this year is much higher than Rs 26,611 crore collected by 15 companies through initial share sale in all of 2020. October and November saw Rs 37,000 crore being raised through the IPO route with Paytm accounting for half of that amount. 2021 is already a record year for IPOs, beating 2017 by a margin, and there is still one month to go, with a number of mega issues lined up.
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