This Jhunjhunwala stock rises 16% after Credit Suisse assigns outperform rating

Shares of Star Health And Allied Insurance Company zoomed over 16 per cent today after Credit Suisse initiated coverage on the stock with an 'outperform' rating. Star Health and Allied Insurance Company stock gained up to 16.44 per cent to Rs 554.20 against the previous close of Rs 475.95 on BSE.

The stock forms part of ace investor Rakesh Jhunjhunwala's portfolio. Jhunjhunwala is a promoter of Star Health. He (14.40 per cent) and his wife Rekha Jhunjhunwala (3.11 per cent) held 17.51 per cent stake in the insurance firm as of the March 2022 quarter, shareholding pattern data show.

Credit Suisse said the stock had the potential to rise 20 per cent. It assigned a target price of Rs 600 to the stock of Jhunjhunwala-backed firm.

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Credit Suisse has cited Star Health's largest agency network, continued expansion and an attractive risk-reward ratio behind the bullishness on the stock. Star Health's gross premiums have risen at 31 per cent over FY17-22 versus 11 per cent for the overall general insurance industry, Credit Suisse said.

Total 1.11 lakh shares of the firm changed hands amounting to a turnover of Rs 5.75 crore on BSE.

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Market cap of the firm rose to Rs 30,562 crore on BSE. The large-cap stock has gained after two days of consecutive fall. It opened with a gain of 16.44 per cent today.

At 3:24 pm, the stock was trading 11.37 per cent higher at Rs 530.05 on BSE. Star Health share trades higher than 5-day moving averages but lower than 20-day, 50-day, 100-day and 200-day moving averages. The stock has lost 32.28 per cent in 2022 and fallen 23.74 per cent in a month.

Later, the stock ended 11.46 per cent higher at Rs 530.50 on BSE.

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Star Health and Allied Insurance Company made a tepid market debut on December 10, 2021. Shares of Star Health listed at a discount of over 6 per cent to the issue price. The firm made its debut at Rs 845 per share (down 6.11 per cent) on the NSE against the IPO issue price of Rs 900.

The company offered its shares in a price band of Rs 870-900 per share. On BSE, the stock listed at Rs 848.80, 5.68 per cent lower to the IPO price.

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