Star Health and Allied Insurance Company and other insurance stocks such as ICICI Lombard, ICICI Prudential, and New India Assurance were buzzing on the BSE on Thursday.

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This was after Credit Suisse initiated coverage on shares of Star Health and said it believes the stock has the potential to gain 20 percent. The brokerage firm has an ‘outperform’ rating on the stock and a target price of Rs 600.

At 1214 IST, shares of Star Health were trading 7.9 percent higher at Rs 513.4 on the BSE. The stock touched an intraday high at Rs 554.2 after climbing over 16 percent. Credit Suisse said the risk-reward for Star Health is favourable after the recent fall.

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Credit Suisse expects premium growth to pick up in FY23 and also sees a recovery in motor premiums, driven by normalising automobile sales and moderation in pricing.

The initiation of coverage on Star Health hinted at a likely positive outlook for the sector as a while which led to other insurance stocks, including Life Insurance Corporation, trade at around 1-7 percent higher.

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First Published:Jul 7, 2022 1:30 PM IST