Shares of Medi Assist Healthcare Services Ltd. jumped over 11% on Tuesday after its subsidiary acquired Paramount Health Services & Insurance TPA in a deal valued at over Rs 400 crore.
Subsidiary Medi Assist Insurance TPA signed an agreement with Fairfax Asia and Nayan Shah and family to acquire Paramount Health Services & Insurance TPA, a Mumbai-based company.
Paramount is a prominent player in the third-party administrator (TPA) for general, health, and life insurance.
Following its acquisition, Medi Assist TPA's market share will rise to 36.6% in the group segment and 23.6% across the health insurance industry, based on premiums managed. The transaction was finalised at an enterprise value of approximately Rs 311 crore, with around Rs 110 crore in cash equivalents included in the deal.
Medi Assist has integrated businesses consistently with five acquisitions between 2016 and 2023. Two were made last year. The company has been able to turn a negative operating margin business into a 20% Ebitda margin.
Shares of Medi Assist surged over 11% after market open to Rs 624.9. The scrip was trading 8.3% higher at Rs 608.5 apiece at 9:23 a.m. The benchmark NSE Nifty 50 was trading 0.67% lower.
It has risen 45% since listing in January this year. The total traded volume so far in the day stood at 63 times its 30-day average. The relative strength index was at 63.
All the three analysts tracking Medi Assist have a 'buy' rating on the stock, according to Bloomberg data. The average of 12-month analyst price targets implies a potential upside of 2.1%.
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