The agency has assigned ‘CARE A1+’ rating to the long-term facilities of Medi Assist Healthcare.
Care Ratings stated that the rating assigned to Medi Assist Healthcare Services (MAHS) factor in the company’s leadership position in the insurance third-party administrator (TPA) industry, experienced management, tie-ups with all major insurance companies and established relationships with large, reputed corporates, and company’s strong financial risk profile.
Ratings are further underpinned by sustained improvement in operational performance with increased volume of business, strong liquidity, and improving cash flow from operations.
These rating strengths are partially offset by intensely competitive and fragmented industry and threat from in-house TPAs of insurer companies.
CARE Ratings considers the acquisition announcement on August 26, 2024, of Paramount Health Services & Insurance TPA (Paramount TPA) by MAHS. The announcement involved MAHS’ subsidiary, Medi Assist Insurance TPA (MAITPA) entering a share purchase agreement to acquire a 100% stake in Paramount TPA for an enterprise value of approximately Rs 311.8 crore, subject to closing-related adjustments.
CARE Ratings notes that the acquisition of Paramount TPA by MAHS would strengthen its market leadership position by increasing its market share. MAHS’ credit risk profile is expected to remain strong despite significant liquidity being utilised for the acquisition.
Minimal debt obligations and a considerable cushion in working capital limits provide adequate liquidity comfort.
Medi Assist Healthcare Services is into providing TPA services in India, majorly through its subsidiary, Medi Assist Insurance TPA (MAITPA). MAITPA is one of the earliest IRDAI-licensed third-party administrators (TPA) in India, providing range of services in claim administration & settlement and cashless hospitalisation. As on 31 December 2024, MAHS had a network of over 19,000 hospitals and served over 10,500 corporate clients nationwide, retaining most of them due to its quality service.
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