Jhunjhunwala-backed Star Health IPO subscribed 12% on Day 1

NEW DELHI: The initial public offer (IPO) of Rakesh Jhunjhunwala-backed Star Health and Allied Insurance Company saw tepid response from investors on the first day of the bidding on Tuesday.

The issue saw 12 per cent subscription on Day 1 of the book-building process, BSE data showed. Investors applied for 53,19,008 shares against 4,49,08,947 shares on offer. The quota for retail investors received 64 per cent bids while HNI quota was subscribed 1 per cent. The QIB portion did not receive any bids on the first day of the IPO.

Ahead of the issue, the company decided to allocate a total of 3,57,45,901 equity shares to 62 anchor investors at Rs 900 apiece, aggregating to Rs 3,217.13 crore, according to a circular uploaded on BSE website.



Monetary Authority of Singapore, Government of Singapore, Abu Dhabi Investment Authority, Morgan Stanley Asia (Singapore) Pte, Goldman Sachs (Singapore) Pte, BNP Paribas Arbitrage and Societe Generale are among the anchor investors.

In addition, SBI Life Insurance Company, HDFC Life Insurance Company and Edelweiss Mutual Fund have been allocated shares.

The IPO comprises fresh issue of equity shares worth Rs 2,000 crore and an offer for sale of up to 58,324,225 equity shares by promoters and existing shareholders. The public offer includes a reservation of shares worth Rs 100 crore for employees.

The issue, with a price band of Rs 870-900 a share, is open for public subscription till December 2.

At the upper end of the price band, the initial share sale is expected to fetch Rs 7,249.18 crore. Proceeds from the fresh issue would be used to augment the company's capital base.

About 75 per cent of the issue size has been reserved for qualified institutional buyers (QIBs), 15 per cent for non-institutional investors and the remaining 10 per cent for retail investors.