Mixed set of number; premium growth remains healthy
Q4FY23 Earnings Summary
Star Health reported mixed numbers, on the business growth front gross written premium (GWP) registered a healthy growth of 13.8% YoY / 35.6% QoQ at Rs 4199 crore
Continued focus on retail health segment led to 100 bps YoY improvement in market share (FY23) to 34%
Net written premium (NWP) was up 15% YoY while earned premium growth was at 11% YoY to Rs 2912 crore
Incurred claims was largely steady at Rs 1805 crore, however claims ratio (adjusted) in FY23 stood at 64.6% vs 65.8% in FY22. Net commission expense was up 10.6% YoY while other operating expenses grew higher at 11.8% YoY. Management expense ratio declined from 30.3% in Q4FY22 to 29.3% in Q4FY23. Combined ratio witnessed an improvement at 95.3% (remain in the guided range) vs 117.9% a year ago. Despite that company reported, underwriting loss of Rs 64.8 crore. On account of lower net earned premium and lower investment income, company posted net profit of Rs 102 crore (lower than our estimate) vs Rs241 crore in Q3FY23 (vs loss of Rs 82 crore in Q4FY22)
ICICIdirect Research view on Star Health & Allied Insurance Company Ltd Stock
View: Healthy incremental growth in premium and increase in market share remains positive. Management outlook on growth continue to remain strong, however improvement in combined ratio is the key.
Impact: Neutral
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