స్టార్ హెల్త్‌పై జెఫరీస్ 'బై' రేటింగ్‌ను పునరుద్ఘాటించింది, రూ.650 లక్ష్యం, ఆపరేషనల్ రికవరీకి కారణం

జెఫరీస్, స్టార్ హెਲత్ & అలైడ్ ఇన్సూరెన్స్ కంపెనీ లిమిటెడ్‌పై తన 'బై' కాల్‌ను పునరుద్ఘాటించింది, 650 రూపాయల ధరల లక్ష్యాన్ని కేటాయించింది, ఇది ప్రస్తుత స్థాయిల నుండి గణనీయమైన అప్‌సైడ్ పొటెన్షియల్‌ను సూచిస్తుంది. ఈ బ్రోకరేజ్ సంస్థ, స్టార్ హెల్త్ యొక్క సెప్టెంబర్ త్రైమాసిక ఫలితాలు దాని ఆపరేషనల్ పనితీరులో రికవరీని సూచిస్తున్నాయని, ప్రధానంగా లాస్ రేషియోలలో తగ్గుదల మరియు ప్రీమియం మొమెంటం కొనసాగడం వల్ల అని హైలైట్ చేసింది. A key positive noted was the 130 basis-point year-on-year improvement in the loss ratio, bringing it down to 71.5%. The company's combined ratio, which measures underwriting profitability (loss ratio plus expense ratio), also improved to 101.8% on a like-for-like basis, moving closer to underwriting breakeven. However, the reported profit after tax (PAT) for the quarter stood at Rs 54.9 crore, a decrease from Rs 109.4 crore in the prior year. This was attributed to upfront costs amounting to approximately Rs 150 crore associated with a 30% sequential growth in long-term policies, which are recognized immediately under accounting norms. Despite the lower reported profit, core insurance metrics showed strength. Gross Written Premium (GWP) increased to Rs 4,371 crore from Rs 4,238 crore in the previous quarter, and Net Earned Premium (NEP) climbed to Rs 3,704 crore, indicating continued traction in Star Health's dominant retail segment. Investment income was slightly below expectations, but the core insurance metrics like loss ratio, commission, and operating costs showed the improvements the market was looking for. Jefferies expects premium growth to continue, driven by retail health penetration and product mix shifts. They anticipate a gradual recovery in combined ratios as the front-loaded costs normalize and loss ratios remain stable. Impact: This news indicates a positive outlook for Star Health & Allied Insurance, with a strong Buy recommendation and a considerable price target from Jefferies. Investors may see this as a signal for potential stock appreciation, assuming the company executes its growth strategy and manages claims effectively. The focus on operational recovery and sustained premium growth suggests a path towards improved profitability and potential valuation re-rating.