Star Health & Allied Insurance Company
Fundamental & Technical Analysis of Star Health & Allied Insurance
STOCK ANALYSIS
9/11/20254 min read
About Company
Star Health & Allied Insurance Company is one of India’s leading private health insurance providers, headquartered in Chennai and founded in 2006 as the country’s first standalone health insurance company. The company specializes in health, personal accident, and travel insurance, serving individual customers, families, and corporates through a wide network of over 14,000 hospitals, 850+ branch offices, and more than 6.8 lakh agents across the nation. Star Health offers easy access to cashless hospitalization, free Telehealth consultations, and 24x7 claim assistance, aiming to provide quick and transparent services without third-party administrators. With an emphasis on customer needs and innovative products, Star Health has covered over 17 crore lives to date and is known for its strong in-house claim settlement team that processes claims efficiently and reliably.
Business Segments
Star Health & Allied Insurance Company operates mainly in three business segments: retail health insurance, group health insurance, and personal accident and travel insurance. Its retail segment includes individual and family health policies like Family Health Optima, which are designed for personal medical coverage. The group segment provides health plans for employees of companies and members of organizations, such as Group Arogya Sanjeevani and Star Group Health Insurance, offering hospitalization, maternity, and daycare benefits under a single policy. The company also offers specialized products for personal accident coverage and travel insurance, serving the needs of various market sectors.
Company's Branches
Star Health & Allied Insurance Company has a robust network of over 835 branch offices and customer service centers spread across India, with its registered office located in Chennai. The company maintains a large team of agents and staff, providing accessible facilities for policy purchase, claims processing, customer support, and grievance resolution at each branch. Additionally, Star Health supports its operations with digital platforms, allowing online policy management, branch locator tools, and telehealth consultation services, all designed to enhance convenience and service quality for its customers nationwide.
Future Plans
Star Health & Allied Insurance Company plans strong future growth mainly by focusing on increasing its premium income through a sharp focus on the retail health insurance segment while limiting exposure to group health business, especially large corporates. The company aims to grow its gross written premiums from around ₹17,500 crore in FY25 to ₹30,000 crore in the next few years by enhancing operational efficiencies with technology investments and better claims management. Star Health is also emphasizing tighter control on expenses, claims ratio management, expanding its digital offerings, and rewarding policyholders with good health through discounts. They are building a sustainable consumer-facing franchise with growth engines in agency distribution, bancassurance, SME corporate segments, and digital channels. Additionally, Star Health is exploring new markets such as motor insurance and potentially life insurance, indicating diversification plans in the future.
Financial Prospects of the Company
The market valuation of the company is 25,799 crores
The stock price is 439
The price-to-earnings ratio of the company is 43.8
The book value of the company is 120
The price-to-book value of the company is 160
The earnings per share of the company is 10
The return on capital employed (ROCE) is 12.0%
The return on equity (ROE) is 9.37%
The company pays an annual dividend yield of 0.00%
Company Sales & Profits in the Last 5 Years
In FY 2020-21, sales were 5,050 crores and profits were -1,086 crores. In FY 2021-22, sales were 10,602 crores and profits were -1,041 crores. In FY 2022-23, sales were 12,096 crores and profits were 619 crores. In FY 2023-24, sales were 14,021 crores, and profits were 845 crores. In FY 2024-25, sales were 16,101 crores and profits were 646 crores.
Company's Sales & Profit Growth in the Last 5 Years
In the last 5 years, sales growth was 26.4% and profit growth was 18.6%. In the last 3 years, sales growth was 15.0% and the profit growth was 37.6%. In the last 1 year, sales were 13.6% and profit growth was -32.7%
Investors
Shareholding Pattern
Promoters hold 58.02%, FIIs hold 13.89%, DIIs hold 21.08% and Public hold 6.97%
Company News
The latest news about Star Health & Allied Insurance Company includes its exploration of entering the general insurance sector to mitigate Input Tax Credit (ITC) losses by applying for a composite license, which would allow expansion beyond health insurance products. This move aims to diversify its portfolio and improve financial efficiency. Additionally, the company has embraced the GST exemption on health and term insurance premiums effective from September 22, 2025, enabling customers to buy policies now without paying GST while coverage starts from the rollout date, making health insurance more affordable. Recently, the company held investor and analyst meetings in early September 2025 and scheduled its Annual General Meeting for September 23, 2025.
Technical Analysis
Company Chart
Moving Average (MA)
The stock is trading near the 50-MA, which indicates that the stock is neither in an uptrend nor in a downtrend.
The stock is also trading near the 200-MA, which clearly indicates that the stock is in a sideways trend.
Chart Patterns
The chart patterns show that the stock price has fallen significantly, but now it seems to give a breakout if the market performs well.
Relative Strength Index (RSI)
Currently, the RSI of the stock is 49, which indicates that the stock is neither in overbought zone neither in oversold zone.
Strengths & Weaknesses
Strengths
Leading market position in retail health insurance with around 13-15% market share in India.
Wide network of over 14,000 hospitals providing cashless treatment and hassle-free claim settlement.
High claim settlement ratio historically around 89-92%, supported by an in-house claim settlement team without third-party administrators (TPA), ensuring faster claims.
Comprehensive range of health insurance products covering individuals, families, senior citizens, critical illness, maternity, and pre-existing diseases.
24/7 customer support and free telemedicine facilities are enhancing customer experience.
Strong agent and branch network across India supporting wide distribution.
Weaknesses
Heavy reliance on third-party agents for sales (~70%), increasing commission costs and reducing direct customer control.
Challenges in claims management due to high volume, with some delays affecting customer satisfaction recently; the claim settlement ratio dropped to ~82% in some recent quarters.
Limited investment in digital transformation compared to competitors, possibly impacting operational efficiency and customer experience.
Rising healthcare costs have exerted pressure on profitability, with a combined ratio above 100% indicating that claims and expenses exceed premiums.