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Star Health and Allied Insurance shares list at discount to IPO price, fall over 5% on debut trade

Star Health and Allied Insurance Company shares listed on the stock exchanges today at a discount to IPO price. The stocks began trading at Rs 848 per share, down 5.69% or Rs 51.2 per share from the issue price of Rs 900 per equity share. Minutes into the initial day of trade, the stock trimmed losses and was seen moving higher, inching closer to the issue price. The weak listing was on expected lines after the IPO failed to attract interest from investors during its three-day initial share sale earlier this month. Star Health is backed by ace investor Rakesh Jhunjhunwala who owns a 14.98% stake in the private insurance company. On listing, Star Health and Allied Insurance Company had a market capitalization of Rs 48,850 crore.

“On the listing day, Star Health and Allied Insurance Company stock is down ~2% mainly due to fear of new Covid variant omicron. However, Company has strong growth rates. We are positive on stock and every dip in share prices provides buying opportunities to long term investors,” said Amarjeet Maurya, AVP, Research, Angel One. On the other hand Ravi Singhal, Vice Chairman of GCL Securities said that allottees should book loss at current levels as weak listing was widely expected. “The public issue was offered at around 15 to 20% higher valuations and hence the share price of the newly listed insurance stock may further go down. One should take fresh position in the counter at around Rs 725 to Rs 750 levels for 6 months target of Rs 1000 to Rs 1100 keeping stop loss at Rs 640 levels,” he added.

The Rs 7,249 crore IPO had seen a muted response from investors on Dalal Street, failing to raise the said amount. Qualified Institutional Buyers (QIB) had bid for 1.03 times the IPO size reserved for them while the Retail portion of the issue was subscribed to 1.10 times. However, Non-Institutional Investors (NII) and employees of the firm did not subscribe their portion of the IPO completely.

Analysts had raised red flags around the valuations demanded by the company. “At the higher price band of Rs. 900, Star Health is demanding an MCAP-to-net premium earned multiple of 10.3x, which is at a premium to the peer average. Moreover, the demanded valuations are at an elevated premium to recent capital issuance,” analysts at Choice Broking had said earlier. Star Health is one of the largest private health insurers in India with a market share of 15.8% in the fiscal 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.

The company saw its profitability getting hit during the covid-19 pandemic impacted by higher claims. Start Health and Allied Insurance reported an operating loss of Rs 1,071 crore in financial year 2020-21 as compared to a profit of Rs 360.8 crore and Rs 164.7 crore in fiscal year 2019-20 and 2018-19.

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MapMyIndia IPO to open on Dec 9; price band set at Rs 1,000-1,033/ share

Digital mapping company MapMyIndia, which powers Apple maps, has fixed a price band of Rs 1,000-1,033 a share for its Rs 1,040-crore initial share-sale, which will open on December 9. The three-day initial public offering (IPO) will conclude on December 13. The bidding for anchor investors will open on December 8, the company announced. The IPO is entirely an offer for sale of up to 10,063,945 equity shares by existing shareholders and promoter.

The OFS comprises sale of up to 42.51 lakh equity shares by Rashmi Verma, up to 27.01 lakh equity shares by Qualcomm Asia Pacific Pte Ltd and up to 13.7 lakh equity shares by Zenrin Co Ltd. In addition, the remaining 17.41 lakh equity shares will be offloaded by several other selling shareholders.

At present, promoters Rakesh Kumar Verma and Rashmi Varma hold 28.65 per cent and 35.88 per cent stake in the company.
The public issue is expected to fetch Rs 1,039.6 crore at the upper end of the price band. MapMyIndia, also known as CE Info Systems, is backed by global wireless technologies company Qualcomm and Japanese digital mapping Zenrin. The New Delhi-based company is leading provider of advanced digital maps, geospatial software and location-based IoT technologies.

It provides products, platforms, application programming interfaces (APIs) and solutions across a range of digital map data, software and IoT under the MapmyIndia and Mappls brands. The company’s customers include PhonePe, Flipkart, Yulu, HDFC Bank, Airtel, Hyundai, MG Motor, Avis, Safexpress and Goods and Service Tax Network (GSTN).

Apple products use MapmyIndia maps as do payment gateways like PayTm, PhonePe, or e-commerce food delivery platforms like McDonalds, Grofers, Cars24. Store locators by companies like SBI Branch Locator, Bajaj Finserv, Prasar Bharti DTH Dealer locator use the same. Half of the issue size has been reserved for qualified institutional buyers (QIBs), 15 per cent for non-institutional investors and 35 per cent for the retail investors.

Investors can bid for a minimum of 14 equity shares and in multiples thereof. Axis Capital, JM Financial, Kotak Mahindra Capital and DAM Capital Advisors are the lead managers to the issue.

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Bank of Baroda raises Rs 1,997 cr via Basel III-compliant bonds

State-owned Bank of Baroda on Friday said it has raised Rs 1,997 crore by issuing Basel III-compliant bonds. The bank had come out with a Rs 2,000 crore issue of additional tier-I bonds on November 24.

“The bank has received total bid amount of Rs 5,308 crore, out of which the issuance was finalised for Rs 1,997 crore at 7.95 per cent (per annum),” BoB said in a regulatory filing.

The bank said it issued a total of 1,997 bonds of Rs 1 crore each under this issue to a total of 21 allottees. To comply with Basel-III Capital Regulations, banks need to improve and strengthen their capital planning processes.

These norms are being implemented to mitigate concerns on potential stresses on asset quality and consequential impact on performance and profitability of banks. Stock of Bank of Baroda traded 3.33 per cent lower at Rs 89.90 apiece on BSE.

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Exchanges decide to implement T+1 settlement cycle in phased manner

Stock exchanges and other market infrastructure institutions on Monday came out with a roadmap for the implementation of T+1 (trade plus one day) settlement cycle whereby the mechanism will be introduced in a phased manner from February 25.

T+1 means that market trade-related settlements will need to be cleared within one day of the actual transactions taking place. Currently, trades on the Indian stock exchanges are settled in two working days after the transaction is done (T+2).

The settlement cycle will be implemented in a phased manner and will apply only to the bottom 100 companies starting February 25, and from March 2022 onwards, the next bottom 500 stocks will be available for introduction to T+1 settlement, according to a joint statement.

The decision has been taken by market Infrastructure Institutions or MIIs — stock exchanges, clearing corporations and depositories. This comes after markets regulator Sebi in September permitted stock exchanges to introduce T+1 settlement cycle from January 1, 2022 on any of the securities available in the equity segment. As per the statement, all listed stocks, across stock exchanges (BSE, NSE and MSEI), will be ranked in descending order based on daily market capitalization averaged for month of October 2021. Where a stock is listed on multiple exchanges, the market capitalization will be calculated based on the price of stock at the stock exchange with highest trading volume during the period under review.

The list of stocks and exchanges where they are available for trading will be published on website of all exchanges. Based on the ranking arrived, the bottom 100 stocks will be available for introduction of T+1 settlement, from February 25, 2022. Thereafter, from March 2022 onwards, on the last Friday (trade day) of every month, the next bottom 500 stocks from the list of stocks ranked will be available for introduction to T+1 settlement. In case Friday is a trading holiday, the same will be introduced on immediate next trading day.

Any new stock getting listed after October 2021, will be added to list, based on the market capitalization calculated on the basis of average trading price of 30 days after commencement of trading. In case, based on market capitalization, if the stock falls under the category (in terms of market capitalization) of stocks already under T+1 settlement then that stock also becomes eligible for T+1 settlement and will be introduced in T+1 settlement cycle on the last Friday (trade day) of next month.

This will also apply to new stock getting listed on account of initial public offering (IPO), corporate action or any other reason and the date of transition will be announced jointly by all exchanges on which the stock is available for trading.

Securities such as preference shares, warrants, right entitlements, partly paid shares and securities issued under differential voting rights (DVR) will be transitioned to T+1 settlement along with the stock of parent company.

Further, more than 5,000 securities listed by the exchanges in the equity segment of bourses will be transitioned to T+1 settlement cycle along with the last scheduled batch of securities as determined by the exchanges.

Any security getting listed post the trade date of last scheduled batch of securities based on the ranking arrived will be directly introduced with T+1 settlement cycle.

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