Jhunjhunwala-backed Star Health off to tepid start, lists at 6% discount

New Delhi: Shares of Star Health and Allied Insurance Company made a tepid debut on Dalal Street on Friday as the scrip got listed at Rs 845 on NSE, a discount of 6.11 per cent to its issue price of Rs 900.

On the BSE, the company debuted at Rs 848.8, a discount of 5.69 per cent.

A day ahead of listing, shares of Star Health were trading at a discount of Rs 70-75 per share in the grey market.

The IPO of Star Health Insurance ran between November 30 and December 2. The company sold its shares in the range of Rs 870-900 apiece.

The company was eyeing to raise Rs 7,249.18 crore via the initial stake sale, including the issuance of fresh equity shares worth Rs 2,000 crore and Rs 5,249.18 crore offer for sale (OFS) from existing promoters and shareholders.

However, the issue was merely subscribed 79 per cent during the three-day book-building process, as institutional and HNI bidders gave IPO a miss.

Star Health and Allied Insurance Company had to trim its IPO size to Rs 6,400 crore to make it sail through. The OFS size was pruned to Rs 4,400 crore from Rs 5,249 crore.

Despite the backing of Rakesh Jhunjhunwala, a dominant presence in an underpenetrated market, robust growth prospects and 'subscribe' rating from the brokerages, the issue failed to excite the investors.