This Rakesh Jhunjhunwala stock rallies 54% in a month, analysts see up to 15% more jump Rakesh Jhunjhunwala stock Star Health and Allied Insurance Company has rallied more than 50% in a month and analysts see more upside on the stock going forward. After Star Health’s fiscal first quarter results, brokerage firms have maintained their ‘Buy’ ratings, remaining optimistic on the overall prospects of the insurance company. Star Health shares were quoting at Rs 732, down 2.2% on NSE intraday. According to the latest shareholding pattern of Star Health, Rakesh Jhunjhunwala and his wife Rekha Jhunjhunwala hold 14.39% and 3.10% stake respectively as of 30 June 2022. Star Health is among the largest insurer engaged in health insurance segment with relatively superior market share, operating performance.Should you buy Star Health and Allied Insurance Company shares? Healthy earnings growth, limited cyclicality risk to boost stock Star Health to maintain leadership in retail health segment ICICI Securities also holds a positive outlook on the stock. “Star Health is expected to maintain its leadership in retail health segment with sustainable long term growth opportunity. Steady claims ratio and 20-25% growth in premium to improve combined ratio and support RoE. We maintain a BUY rating on the stock with target price of Rs 860,” the domestic brokerage and research firm said in its note. The brokerage factors 19% premium CAGR between FY22-24, combined ratio of 95, 94% and investment yield of 7%,7.5% for FY23 and FY24 respectively. “We have upgraded our FY24 earnings to factor the renewed confidence in terms of earnings potential seen in the company’s product and distribution strategy,” it said. Stock down 20% from 52-week high It is worth noting that Star Health launched its IPO from November 30 to December 2 last year. The issue was not fully booked and received 79% subscription against its offered size. Star Health shares debuted on stock exchanges on 10 December 2021. The stock had hit a 52-week high of Rs 940 apiece during the initial days before correcting. Compared to its 52-week high, Star Health shares have plunged by 20% on NSE as of 31 July 2022. Meanwhile, against its issue price of Rs 900, the stock has dipped by 17%. (The stock recommendations in this story are by the respective research analysts and brokerage firms. FinancialExpress.com does not bear any responsibility for their investment advice. Capital markets investments are subject to rules and regulations. Please consult your investment advisor before investing.)
If the current trend continues for a longer period of time, not only oil mills but oilseeds growers will also not be able to get good rates of their produce, says Samir Shah, president of Gujarat State Edible Oils and Oil Seeds Association (GEOA). Shah who is also past president of SOMA says that due to various international factors rates of edible oils had gone up considerably, especially imported oils earlier this year.
“With a view to curb rising prices of edible oil, the Government of India reduced import duty on edible oils. Considering the fact that India is producing hardly 30 percent of its edible oil requirement, the decision was right at that point of time. Now when international prices of edible oils have gone down by 15 percent to 25 percent and high production period has started in edible oil exporting countries, the government should gradually increase import duty to protect local oil mills and oilseeds growers,” said Shah. GEOA has also made representation before Union Minister for Commerce & Consumer Affairs, Piyush Goyal to increase import duty.
In June import duty on edible oils was ranging from 35 to 55 percent, since then the government gradually reduced import duty and at present it is ranging from zero percent to 15 percent on different edible oils, he said.
Just a month back prices of edible oils were through the roof and the government took appropriate measures by reducing import duty in order to protect consumers, says Atul Chaturvedi, president of Solvent Extractors Association of India (SEA). “Prices of edible oils are coming down globally. Kharif sowing has already started across the country. In the interest of local farmers, it is high time to enhance import duty in a phased manner to encourage local edible oil value chain,” opined Chaturvedi.
On Thursday imported Palm oil prices were at around Rs 2100 per 15 kg as against local Rs 2700 and Rs 2550 of groundnut and cottonseed oils. Prices of other local oils including ricebran, coconut, soyabean and mustard remained as high as Rs 2350, Rs 2520, Rs 2500 and Rs 2580 respectively.
India imports around 13-13.5 million tonnes of edible oils, of which around 8-8.5 million tonnes (around 63 per cent) are palm oil. Though the price of other imported Sunflower oil remained at around Rs 2700 per 15 kg, but import quantity of the oil is much lower than that of palm oil.