Dr Agarwal Healthcare IPO Opens Today: Should you subscribe? Here's what market wizard Anil Singhvi
Dr Agarwal’s Healthcare’s Initial Public Offering (IPO) opens for subscription today, January 29, and will close on January 31. The price band for the IPO has been set at Rs 382- 402 per share. The IPO is a mix of a fresh issue and an offer for sale (OFS), with a total issue size of Rs 3,027.26 crores.
Zee Business Managing Editor Anil Singhvi has suggested that the IPO is suitable only for high-risk-taking investors due to its expensive valuation and the significant OFS component. While the company has a strong brand and market presence, the competitive landscape and recent growth trajectory may pose challenges. Investors should carefully evaluate their risk appetite before subscribing.
Singhvi also outlined some positives and negatives of the company; here's the list:
- Experienced and professional promoters.
- Strong brand with market leadership.
- Asset-light business model.
- Impressive anchor investor participation.
- No significant entry barriers, leading to intense competition.
- Despite being an old company, significant growth has been observed only recently.
- Highly expensive valuation.
- Only Rs 300 crores is a fresh issue, with the majority being an OFS (Rs 2,727 crores).
The total issue size stands at Rs 3,027.26 crore, which includes a fresh issue of Rs 300 crore and an offer for sale (OFS) worth Rs 2,727.26 crore. Through the fresh issue, the company will release 0.75 crore new shares, while existing shareholders will offload 6.78 crore shares via the OFS route.
- Retail investors: Minimum application of 35 shares, requiring an investment of Rs 14,070.
- Small non-institutional investors (sNII): 15 lots (525 shares), amounting to Rs 2,11,050.
- Large non-institutional investors (bNII): 72 lots (2,520 shares), totaling Rs 10,13,040.
The share allotment is expected to be finalised on February 3, with a tentative listing date of February 5 on the BSE and NSE.
Ahead of the IPO, Dr. Agarwal’s Healthcare raised Rs 875.50 crore from anchor investors on January 28. A total of 2,17,78,798 equity shares were allotted at Rs 402 per share to domestic and foreign investors.
Established in 2010, Dr. Agarwal’s Healthcare provides eye care services, including cataract and refractive surgeries, consultations, diagnostics, non-surgical treatments, and the sale of optical products and eye care pharmaceuticals.
As of September 30, 2024, the company operated 193 facilities, mainly in South India, with an expanding presence in the western region. It has 737 doctors and served 2.13 million patients in FY24, performing 220,523 surgeries. In the first half of FY24, it treated 1.15 million patients and conducted 140,787 surgeries.
For FY24, the company reported revenue of Rs 1,332.15 crore and a profit after tax of Rs 95.05 crore.
