Dr Agarwal's Health Care IPO: Price Band, Financials, Key Dates, GMP And More — All You Need To Know
The proposed initial public offering consists of a fresh issue of Rs 300 crore and an OFS of Rs 2,727.3 crore
Eyecare provider Dr Agarwal's Health Care Ltd.'s Rs 3,027.3-crore initial public offering is scheduled to open on Wednesday.
The price band for the IPO has been set in the range of Rs 382 to Rs 402 per share. The market value at the upper end of the price band is Rs 12,698 crore, according to NDTV Profit's calculations.
The proposed IPO consists of a fresh issue of Rs 300 crore and an offer-for-sale component of Rs 2,727.3 crore, according to the red herring prospectus.
The OFS by promoters consists of sale of 21.8 lakh equity shares by Amar Agarwal, up to 26.3 lakh shares by Athiya Agarwal, up to 30.7 lakh shares by Adil Agarwal, up to 36.1 lakh shares by Anosh Agarwal and up to 24.1 lakh shares by Ashvin Agarwal. Dr. Agarwal's Eye Institute, also a promoter, will offload 18.8 lakh shares.
Arvon Investments Pte., Claymore Investments (Mauritius) Pte. and Hyperion Investments Pte. are investors who are offloading their shares, while Farah Agarwal and Urmila Agarwal are other shareholders who are selling a stake.
Kotak Mahindra Capital Co., Morgan Stanley India Co., Jefferies India Pvt. and Motilal Oswal Investment Advisors are the book-running lead managers to the issue and KFin Technologies Ltd. is the registrar to the offer.
The equity shares are proposed to be listed on both the BSE and National Stock Exchange. The anchor investment round is scheduled for Tuesday. The IPO will close on Friday.
IPO Details
Issue opens: Jan. 29.
Issue closes: Jan. 31.
Issue price: Rs 382–402.
Offer for sale: Rs 2,727.3 crore.
Fresh issue: Rs 300 crore.
Total issue size: Rs 3,027.3 crore.
Lot size: Minimum 37 shares, and then in multiples thereof.
Market value at the upper end of price band: Rs 12,698 crore.
Business
Dr Agarwal's Health Care offers a wide range of comprehensive eye care services, including cataract surgeries, refractive surgeries and other specialised treatments. Their services also encompass consultations, diagnoses, non-surgical treatments, and the sale of optical products, contact lenses, accessories and eye care-related pharmaceutical products.
The company held an approximate 25% market share of the total eye care service chain market in India during the last fiscal, according to a Crisil MI&A Report. As of Sept. 30, 2024, the company operated a network of 209 facilities across India.
Financial Performance
The company reported a 7.9% decline in net profit at Rs 95.1 crore in fiscal 2024 from Rs 103.2 crore in the previous fiscal. Revenue was up 31% to Rs 1,332.2 crore.
Operating income or earnings before interest, taxes, depreciation, and amortisation rose to Rs 362.2 crore in the same period. The Ebitda margin expanded to 27.2% from 26.6%.
As of Dec. 31, 2024, the company's debt pile stood at Rs 360.6 crore.
There are no Indian listed peers focusing on eye care services with a comparable size and scale as that of Dr Agarwal's Health Care, as per the RHP.
Listed peers include eight health care companies, comprising Apollo Hospitals Enterprise Ltd., Max Healthcare Institute Ltd., Fortis Healthcare Ltd., Global Health Ltd., Narayana Hrudayalaya Ltd., Krishna Institute of Medical Sciences Ltd., Aster DM Healthcare Ltd., and Rainbow Children's Medicare Ltd.
Use Of Proceeds
The company will use Rs 195 crore for repayment or prepayment of borrowing, and the remaining towards general corporate purposes and unidentified inorganic acquisition.
Key Risks
The company operates in a regulated industry, and failure to comply with applicable safety, health, environmental, labour, and other regulations, or failure to obtain or renew necessary approvals, can negatively impact the business.
A significant majority of the company’s facilities are located in Tamil Nadu (especially Chennai), Maharashtra, and Karnataka. Any adverse developments in these areas can harm the company's business.
International operations expose the company to various risks, including management, legal, tax, political and economic risks.
The company is exposed to credit risks related to payments from third parties, including government schemes, corporations, insurance companies and third-party administrators.
Income from surgeries constitutes a significant majority of the company's revenue. Any adverse effects on this income can negatively impact the business.
Dr Agarwal's Health Care IPO GMP
The grey market premium of Dr Agarwal's Health Care's IPO is Rs 13 as of 9:31 p.m. on Jan. 27, according to InvestorGain. This implies shares of the company will likely list at Rs 415 apiece, indicating a 3.23% premium to the upper end of the price band.
It should be noted that GMP or grey market price is not an official price quote for the stock and is based on speculation.
Disclaimer: Investments in initial public offerings are subject to market risks. Please consult with financial advisors and read red herring prospectus thoroughly before placing bids.
