Star Health & Allied Insurance IPO - Subscription Day 3

5paisa Research Team 5paisa Research Team 15th December 2022 - 05:57 pm

The Rs.7,249 crore IPO of Star Health & Allied Insurance, consisting of a fresh issue of Rs.2,000 crore and an offer for sale (OFS) of Rs.5,249 crore, saw tepid response on Day-1 and Day-2 of the IPO. As per the combined bid details put out by the BSE at the close of Day-3, Star Health & Allied Insurance IPO was subscribed 0.79X overall, with the retail and QIB portion just about getting subscribed while the HNI / NII portion remained grossly undersubscribed. The issue has closed for subscription on 02nd December.

As of close of 02nd December, out of the 449.09 lakh shares on offer in the IPO, Star Health saw bids for 355.85 lakh shares. This implies an overall subscription of 0.79X.

The granular break-up of subscriptions was dominated by the retail investors and the QIB portion, which just about got subscribed. However, the interest was virtually lacking in the HNI segment and that remained unfilled.

Star Health & Allied Insurance IPO Subscription Day-3

Category	Subscription Status
Qualified Institutional Buyers (QIB)	1.03 Times
Non Institutional Investors (NII)	0.19 Times
Retail Individuals	1.10 Times
Employees	0.10 Times
Overall	0.79 times

QIB Portion

Let us first talk about the pre-IPO anchor placement. On 29th November, Star Health & Allied Insurance did an anchor placement of 3,57,45,901 shares at the upper end of the price band of Rs.900 to 62 anchor investors raising Rs.3,217.13 crore.

Check - Star Health IPO - Subscription Day 2

The list of QIB investors included a number of marquee global names like Government of Singapore, Monetary Authority of Singapore, Ballie Gifford, BNP Paribas, Goldman Sachs, Janchor Partners, Universities Superannuation Fund and Abu Dhabi Investment Authority (ADIA). Domestic anchor investors included HDFC Life, Max Life, Bharat AXA Life, IIFL Opportunities Fund, Mirae MF and Edelweiss Mutual Fund; among others.

The QIB portion (net of anchor allocation as explained above) has a quota of 238.31 lakh shares of which it has got bids for 244.93 lakh shares at the close of Day-3, implying subscription of just about 1.03X for QIBs at close. QIB bids typically get bunched on the last day but even that heavy demand was just about sufficient to see the issue thorough once, despite the strong appetite shown in the anchor round.

HNI / NII Portion

The HNI portion got subscribed 0.19X (getting applications for 22.76 lakh shares against the quota of 119.15 lakh shares). This is a very tepid response at the close of Day-3 and even on the last day there was no flurry of activity by the HNIs. Even the funded applications were absent as the cost of funds would have struggled to cover if the listing was weak.

Retail Individuals

The retail portion was subscribed a more decent 1.10X at the close of Day-3, showing reasonable retail appetite. It must be noted that retail allocation is only 10% in this IPO.

For retail investors; out of the 79.44 lakh shares on offer, valid bids were received for 87.00 lakh shares, which included bids for 68.59 lakh shares at the cut-off price. The IPO is priced in the band of (Rs.443-Rs.453) and has closed for subscription on 02nd December 2021.

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Star Health and Allied Insurance IPO - Information Note