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Star Health and Allied Insurance Company Ltd is one of the largest private health insurers in India with a market share of 15.8% in Fiscal 2021. From being the first standalone health insurance ("SAHI") company established in India in 2006, it has grown into the largest SAHI company in the overall health insurance market in India, according to CRISIL Research. Company offer a range of flexible and comprehensive coverage options primarily for retail health, group health, personal accident and overseas travel, which accounted for 87.9%, 10.5%, 1.6% and 0.01%, respectively, of their total Gross written premium (GWP) in Fiscal 2021. Individual agents are the primary distributors of the company's health insurance plans, accounting for 78.9% of their GWP in Fiscal 2021. In addition, the company has successfully built one of India's largest health insurance hospital networks, with 11,778 hospitals as of September 30, 2021.

* Company consistently ranked first in the retail health insurance market in India based on retail health GWP over the last three Fiscal Years, according to CRISIL Research.

* The retail health market segment is expected to emerge as a key growth driver for the overall health insurance industry in India after the COVID-19 crisis in India

* As of September 30, 2021 its distribution network had grown to 779 health insurance branches spread across 25 states and 5 union territories in India.

* The company has also successfully built one of the largest health insurance hospital networks in India, with 11,778 hospitals, of which 7,741 hospitals, or 65.7 percent of the total number of hospitals in their network, entered into pre-agreed arrangements with in Fiscal 2021.

Outlook & Valuation:

The company has mixed set on financials over the last three years where the company's GWP has increased over the years while the company suffered a loss in FY21. In FY19, the revenues of the company were Rs 3713 cr while in FY21 it grew to 5283 cr. The Profit was at Rs 128 cr in FY19 while the company suffered a loss of Rs 825 cr in FY21. The health insurance sector is likely to flourish as individuals become more aware of the benefits of health insurance. If we look at the company's financials, we can see that it was doing well until Covid hit last year. The company has the largest market share which is positive for the company however the industry is getting competitive. The valuation of the company is stretched r. At the upper 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. Thus, we assign a "SUBSCRIBE" rating only for the long term.

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