Star Health and Allied Insurance Company (STARHEALTH) Q1 24/25 earnings summary

Executive summary

• Maintained leadership in health insurance with a 31% retail market share and a diversified network of 718k agents and 887 branches, focusing on profitable growth, customer centricity, and digital transformation, with 72% of policies issued digitally.

• Four growth engines (agency, banca, corporate, digital) drive business, with agency contributing 80% of Q1 FY25 GWP and digital at 7%.

• Expanded distribution network, especially in rural and semi-urban areas, and launched home healthcare services in 50+ cities.

• Board approved unaudited standalone financial results for Q1 FY25 and reappointment of the Managing Director & CEO for five years from December 16, 2024.

• Several senior officials were reclassified as non-key managerial personnel effective July 30, 2024.

Financial highlights

• Gross Written Premium (GWP) for Q1 FY25 grew 18% YoY to INR 3,477.76 crores (INR 34,759 million), with PAT up 11% YoY to INR 319 crores (INR 3,189 million).

• Combined Ratio at 99.2% (vs 97.8% YoY); Claims Ratio at 67.6% (vs 65.4% YoY); Expense Ratio at 31.6% (vs 32.4% YoY).

• Investment income for Q1 FY25 was INR 295 crores (INR 2,953 million), with investment assets at INR 15,802 crores (INR 158 billion), up 19% YoY.

• Solvency ratio stood at 2.29x (regulatory minimum 1.5x); return on equity for Q1 FY25 was 4.9% (non-annualized).

• Earnings per share (basic) for Q1 FY25 was ₹5.45, compared to ₹4.95 in Q1 FY24.

Outlook and guidance

• Targeting to double GWP to INR 30,000 crores and triple PAT to INR 2,500 crores by FY28.

• Two to three product price hikes planned in FY25, covering about 30% of the portfolio, with an average hike of 10-15%.

• Continued focus on expanding digital and alternate distribution channels, with 25% growth in both banca and digital segments.

• Remain on track for 50 bps YoY improvement in claims and OpEx ratios.

• Financial results for the quarter are not indicative of full-year performance due to seasonality in the health insurance industry.