Direct Gross Premium
Gross direct premium of Care Health Insurance has increased significantly in Q4 FY23, rising to ₹1,495.46 Cr from ₹1,250.77 Cr in Q3 FY23.
The yearly numbers show the rising trend as well; the gross direct premium for FY23 was ₹5,141.52 Cr, a significant rise from FY22’s ₹3,880.91 Cr.
This suggests that Care is on a sound growth trajectory in terms of producing premium income.
Net Premium Earned by Care Health
The net earned premium continued to rise in Q4FY23, rising from ₹969.61 Cr in Q3FY23 to ₹1,201.59 Cr.
In a similar vein, the net earned premium for FY23 rose to ₹3,932.04 Cr from ₹2,510.84 Cr in FY22.
This denotes an increase in the company’s revenue once policy cancellations, reinsurance, and other associated costs are taken into consideration.
Operating Income of Care Health
Operating profit increased significantly from Q3FY23’s ₹47.20 Cr to ₹519.27 Cr in Q4FY23. Additionally, the annual operating profit improved dramatically, going from ₹282.97 to ₹643.72 crores in FY22 to FY23.
This suggests enhanced operational effectiveness and cost control, which will increase Care Health Insurance’s profitability.
Net Income of Care Health
In comparison to Q3FY23’s ₹56.84 Cr, the net profit for Q4FY23 was ₹99.27 Cr. The annual net profit for FY23 was ₹245.84 Cr, a significant increase from FY22’s net profit of ₹11,50 Cr.
This displays good financial performance and profitability, which shows efficient cost- and revenue-control strategies.
Combined net worth
The total net worth of Care Health Insurance grew from ₹1,289.20 Cr in FY22 to ₹1,749.17 Cr in FY23.
This growth in net worth reflects the company’s strengthened financial position and enhanced capital base, providing a solid foundation for future operations and expansion.
EPS, or earnings per share
EPS for Q4 FY 23 were reported at ₹1.05, up from ₹0.60 in Q3 FY 23.
The annual EPS for FY23 was ₹2.61, which is a significant increase from ₹0.13 in FY22.
This highlights the company’s profitability and potential return on investment by indicating higher earnings accessible to shareholders for each outstanding share.
Overall, Care Health’s financial performance in Q4FY23 and the entire FY23 have been impressive. The business’s premium revenue increased significantly, as seen by its net profit, operating profit, and EPS. Additionally, the substantial increase in total net worth denotes a stronger financial situation. Additionally, the substantial growth in total net worth indicates a stronger financial situation. These encouraging signs point to Care Health Insurance having successful business plans, strong operational performance, and increased market presence.
Current Valuation:
| Particulars | Care Health | Star Health |
| Share Price | Rs. 179 | Rs. 590 |
| Shares Outstanding | 94 Cr | 58.2 Cr |
| Market Capitalization | Rs. 14800 Cr | Rs. 34308 Cr |
| Gross Written Premium | Rs 5141 Cr | Rs 11000 Cr |
| Mcap/GWP Ratio | 2.74x | 3.11x |
With a share price of Rs. 150 per share and over 94 crore outstanding shares, Care Health has a market capitalization of around 14,000 crores. For Care Health, the Grass Written Premium (GWP) is still set at Rs. 5,141 Crores. Care Health’s Mcap/GWP ratio is calculated to be 2.74x.
As at 15.05.2023, there were roughly 58.2 crore shares outstanding, and the share price for Star Health was Rs. 590 per share. The market capitalization as a result is around 34,308 Crores. The GWP for Star Health is still somewhere around 1,000 crores. For Star Health, the Mcap/GWP ratio is calculated to be 3.11x.
Given these numbers, Care still seems to be more affordable than Star Health, with a lower Mcap/GWP ratio (274x as opposed to 3.11x). This shows that, when compared to Star Health, Care’s market capitalisation is substantially more favourable in proportion to its Gross Written Premium.
Religare may sell 6-7% of its health insurance business
- Religare Enterprises is in early talks with private equity investors to sell 6-7% in its subsidiary Care Health Insurance to raise as much as ₹1,200 crore.
- The valuation of care health as per above, would be around ₹17,143 crore but at the moment it’s M-Cap in unlisted space is ₹14800 crore.
- Care Health Insurance reported a 32% rise in its annual gross direct premium to ₹5,142 crore for FY2023 from ₹3,881 crore a year ago.
- The firm’s net written premium rose nearly 50% to ₹4,591 crore from ₹3,088 crore in FY22.
- The group sold a 6.39% stake in the business to PE fund Kedaara Capital for ₹567.3 crore in 2020.
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Also Read: Care Health Insurance Rights Issue