According to a source, Star Health will cut its IPO share offer after the offering received a cautious response during the registration period that ended yesterday.
The IPO of the country’s largest private health insurer was not fully registered before the close of bidding on Thursday, signaling that demand for an IPO in India could wane.
It was registered only 79%, receiving a bid of $427.37 million, even though it extended the registration period for its service.
“The retail and institutional sections are fully registered but that is not the case for HNIs (High Net Worth Individuals.) We have seen a cautious response from HNIs and as a result, have fallen short of approx. $100 million So the result is one source said the size of the offering will be reduced to the scope of the subscriptions below.
Star Health did not immediately respond to a request for comment from Reuters.
The institutional investors and retail segment are fully registered, 1.03x and 1.1x respectively, but bids for them are much lower than with earlier offerings like Nykaa.
“The general feedback we’re getting right now is that the prices are a bit too high. And maybe something should have been left to investors on the table,” the source said.
Founded in 2005, Star Health offers retail health, group health, personal accident and overseas travel insurance options.
Since Paytm’s dismal listing, demand has remained strong for much smaller IPOs from companies with established business models.
Last month, KFC and Pizza Hut restaurant operator Sapphire Foods India rallied in its market debut after its $276 million IPO was oversubscribed 6.62 times.
Data analytics company Latent View more than doubled its listings after investors bid more than 300 times for the shares it offered in its $80 million IPO.
