Face Value: Rs 10 Per Equity Share
Industry : Insurance
Demat Status: NSDL & CDSL
Financial performance of Care Health (Rs crore)
Care Health commenced business in 2012 and currently has three major shareholders – Religare Enterprises Limited, Union Bank of India and Corporation Bank. Care Health Insurance is servicing over 700 locations across the country with a network of 110 plus branches and 9,450 plus hospitals. It has a product bouquet of 18 products encompassing group, travel, and fixed benefits to serve varied customers. Care Health Insurance is marketed by a team behind the hospital chain known as Fortis Health Care.
In 2017, Malvinder and Shivinder Singh-promoted Religare Enterprises Limited (REL) has entered into a definitive agreement with a group of investors led by True North to sell its entire 80 percent stake in Religare Health Insurance Company Limited (RHI). The transaction valued RHI at Rs 1300 crore. However, the deal was not completed due to changes in terms by promoters.
Apart from True North, the other investors in the consortium were Gaurav Dalmia and Faering Capital. Faering Capital is founded by HDFC chairman Deepak Parekh’s son Aditya Parekh and his investment banker friend Sameer Shroff. True North was established in 1999 with a focus on investing in mid-sized profitable businesses across diverse sectors. True North was formerly known as India Value. It has launched five separate investment funds with a combined corpus of over $2 billion.
Care Health Valuation
Total equity share capital as on 31 March 2022 (FY 2022) is Rs 90.80 crore. Based on current market price of Rs 150 approx, market capitalisation comes to around Rs 13500 crore. Latest Book Value is around Rs 14 per share.
Shareholding pattern of Care Healthcare
Religare Enterprises (REL) owns around 70% stake in the firm while Kedara Capital has around 18% stake. Public sector banks including Union Bank and Corporation Bank hold around a 6% stake in the insurance company.
Care Health Rights Issue
Care Health Insurance issued rights shares with face value of Rs 10 at premium of Rs 100 per share. The ratio was 1 rights share for every 34 shares held as on record date of 12 August 2022.
Insurance sector market share
According to the gross premium collection in Fiscal Year 2021, the top three Indian health insurance companies are New India Assurance, Star Health, and United India Insurance.
New India Assurance has an 18 percent market share, while Star Health and United India each have 16 percent and 11 percent. National Insurance and Oriental Insurance are in fourth and fifth place, respectively, with 10 percent and percent of the total health insurance premium held.
Of all the standalone health insurance companies, the only one in the list of top five is Star Health Insurance. Star Health is one of the leading health insurance companies with the largest market share in the retail health insurance industry.
Care Health Insurance Company has market share of 4% in health insurance companies in India.
Care Health Insurance IPO
Shares of Care Health are currently not listed on BSE, NSE. The company is planning to bring out IPO soon.
Care Health Pre IPO Share Price is likely to go up once IPO details are announced.
News and IPO Updates
Religare Enterprises is considering an initial public offer (IPO) of up to ₹2,000 crore for its health insurance subsidiary Care Health Insurance, where it plans to issue fresh shares.
Care Health could become the third from the health insurance segment to launch an IPO after Star Health Insurance and Medi Assist India.
Star Health and Allied Insurance Company Ltd present in General Insurance share price is around Rs 750.
The New India Assurance Company Ltd also in General Insurance trades at around Rs 100.
Care Health Insurance is the lone candidate from the sector with no peer in either listed or unlisted space. Unlisted shares of this domestic health insurer have been having a dream run in the unlisted market, the unofficial market for trading in such stocks. State-owned The New India Assurance, which also offers health insurance alongside other general insurance products, is the only comparable player allowing equity investors exposure in the listed space.
Investment by health insurers in digital renewal of policies has likely paid off. This unlisted stock is keeping investors in the pink of health amid Covid-19 crisis. Additionally, the high share of PSU insurers with low solvency continues to provide a growth opportunity for strong players like Care Health.
Care Health Insurance offers products in the retail segment for critical illness, personal accident, top-up coverage, international travel insurance and maternity covers along with group health insurance and group personal accident insurance for corporates. Investors are betting on an expected spike in demand for insurance products, health insurance in particular, in the wake of the pandemic.
Retail health is a high growth business with high entry barriers. This is proved by the fact that retail health premiums have grown by 20% CAGR over the last 5 years and no player has been able to grow its market share meaningfully apart from Star Health and Care Health over the last 5 years.