STARHEALTH - Fundamental Analysis: Financial Health & Valuation
Back to ListFundamental Rating: 3.3
| Stock Code | STARHEALTH | Market Cap | 30,700 Cr. | Current Price | 521 ₹ | High / Low | 587 ₹ |
| Stock P/E | 55.1 | Book Value | 163 ₹ | Dividend Yield | 0.00 % | ROCE | 8.57 % |
| ROE | 6.70 % | Face Value | 10.0 ₹ | DMA 50 | 496 ₹ | DMA 200 | 473 ₹ |
| Chg in FII Hold | 0.99 % | Chg in DII Hold | -0.65 % | PAT Qtr | 111 Cr. | PAT Prev Qtr | 128 Cr. |
| RSI | 60.8 | MACD | 7.20 | Volume | 8,27,382 | Avg Vol 1Wk | 6,06,728 |
| Low price | 413 ₹ | High price | 587 ₹ | PEG Ratio | -16.0 | Debt to equity | 0.05 |
| 52w Index | 62.4 % | Qtr Profit Var | 21,731 % | EPS | 9.47 ₹ | Industry PE | 42.8 |
📊 Financials: STARHEALTH has a market cap of ₹30,700 Cr. Quarterly PAT declined from ₹128 Cr. to ₹111 Cr., showing pressure on profitability despite a large YoY swing. ROE at 6.70% and ROCE at 8.57% reflect modest efficiency. Debt-to-equity ratio of 0.05 indicates low leverage, supporting financial stability. EPS at ₹9.47 is modest relative to valuation multiples.
💹 Valuation: Current P/E of 55.1 is significantly higher than the industry average of 42.8, suggesting overvaluation. P/B ratio (~3.2) is elevated compared to book value ₹163. PEG ratio at -16.0 indicates distorted growth valuation due to inconsistent earnings. Intrinsic value appears lower than CMP ₹521, limiting near-term upside.
🏦 Business Model: STARHEALTH operates in health insurance, with strong brand presence and distribution network. Its competitive advantage lies in scale, customer trust, and specialized health insurance offerings. However, profitability remains under strain due to claims volatility and regulatory pressures.
📉 Entry Zone: RSI at 60.8 suggests mildly overbought conditions, while MACD at 7.20 indicates bullish momentum. A potential entry zone could be around ₹490–₹510 for accumulation. Long-term investors may hold cautiously, given strong brand presence but weak profitability metrics.
Positive
- 📈 Strong brand presence in health insurance sector.
- 💰 Low debt-to-equity ratio (0.05).
- ⚡ Large distribution network and customer trust.
Limitation
- ⚠️ High P/E (55.1) vs industry average (42.8).
- 📉 Negative PEG ratio (-16.0), reflecting inconsistent earnings growth.
- 🔄 Weak ROE (6.70%) and ROCE (8.57%).
Company Negative News
- 📉 Decline in DII holding (-0.65%).
- ⚠️ Sequential PAT decline (128 Cr. to 111 Cr.).
Company Positive News
- 📊 Increase in FII holding (+0.99%).
- 📈 Stock trading above DMA 50 (496) and DMA 200 (473).
Industry
- 💹 Industry PE at 42.8, lower than STARHEALTH’s 55.1.
- ⚡ Health insurance demand expanding with rising healthcare costs.
- 🏦 Sector sensitive to claims ratios and regulatory changes.
Conclusion
⚖️ STARHEALTH is a well-established health insurance provider with strong brand presence and low leverage. However, profitability remains weak and valuations are stretched. Entry may be considered around ₹490–₹510 for long-term investors, but caution is advised due to earnings volatility and high multiples.
For deeper insights, you could explore STARHEALTH peer comparison or a technical chart analysis to complement this fundamental view.