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Laxmi Dental IPO: Price Band, Financials, Key Dates, GMP And More — All You Need To Know

The price band for the initial public offering has been set in the range of Rs 745 to Rs 785 per share.

<div class="paragraphs"><p>The price band for Laxmi Dental initial public offering (IPO) has been set in the range of Rs 745 to Rs 785 per share&nbsp;(Photo Source: Envato)</p></div>
The price band for Laxmi Dental initial public offering (IPO) has been set in the range of Rs 745 to Rs 785 per share (Photo Source: Envato)

Laxmi Dental Ltd.'s Rs 698.1-crore initial public offering is scheduled to open on Monday. The three-day IPO consists of a fresh issue of Rs 138 crore and an offer for sale of Rs 560.1 crore, according to the red herring prospectus.

The price band has been set in the range of Rs 745 to Rs 785 per share. The market value at the upper end of the price band is Rs 2,352 crore, as per NDTV Profit's calculations.

Rajesh Khakhar and Sameer Merchant are the promoters offloading in the OFS, while OrbiMed Asia II Mauritius Ltd., Jigna Khakhar, Hasmukh Khakhar, Amrish Desai, Parag Bhimjiyani and Kunal Merchant are the other selling shareholders.

Nuvama Wealth Management Ltd., Motilal Oswal Investment Advisors Ltd. and SBI Capital Markets Ltd. are the book-running lead managers for the issue, which will be registered with Link Intime India Pvt.

The equity shares are proposed to be listed on the BSE and the National Stock Exchange.

Issue Details

  • Issue opens: Jan. 13.

  • Issue closes: Jan. 15.

  • Issue price: Rs 407–428.

  • Fresh issue: Rs 138 crore.

  • Offer for sale: Rs 560.1 crore.

  • Total issue size: Rs 698.1 crore.

  • Market value at upper end of price band: Rs 2,352 crore.

  • Lot size: 35 shares.

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Business

Laxmi Dental is a leading player in the Indian dental laboratory industry with over 20 years of experience. In the last financial year, the company ranked among the top two largest dental laboratories in India based on revenue, according to an F&S Report.

The company's product offerings include custom-made crowns and bridges, clear aligners, thermoforming sheets and aligner-related products as part of its aligner solutions, as well as pediatric dental products. It manufactures its products across six facilities.

Laxmi Dental stands out in the export sector, being the largest exporter of custom-made dental prostheses in India, with a primary focus on markets in the US and the UK.

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Financials

The company reported a net profit of Rs 17.9 crore in the last financial year, compared to a loss of Rs 4.4 crore in fiscal 2023. Revenue was up 20% to Rs 193.6 crore.

Operating income, or earnings before interest, taxes, depreciation, and amortisation, rose to Rs 23.8 crore in the same period. The Ebitda margin expanded to 12.29% from 5.54%.

As of Dec. 20, 2024, the company's debt pile stood at Rs 51.6 crore.

Poly Medicure Ltd. is a listed industry peer of the IPO-bound company, as per its RHP. Poly Medicure reported total income worth Rs 1,434.5 crore, with a price to earnings ratio of 94.02, and a return on net worth of 19.05%, as compared to Laxmi Dental's return on net worth of 78.78%.

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Use Of Proceeds

The company will use Rs 19.6 crore to repay or prepay outstanding borrowings and Rs 37.6 crore to purchase new machinery for the company, as per its RHP.

It will invest Rs 13.4 crore for the repayment or prepayment of certain outstanding borrowings in its subsidiaries and Rs 35.1 crore for capital expenditure or purchase of new subsidiaries in the company.

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Key Risks

  • The company's growth relies on expanding their dental network, obtaining recommendations from it and increasing wallet share per dental clinic, dental company and dentist. Failure to do so in a cost-effective manner may adversely affect business, results and financial condition.

  • Business is concentrated in certain regions, both globally and domestically. Loss of business in these areas can negatively impact operations, financial performance and overall business condition.

  • Import and export activities are crucial for operations. Inability to manage business in overseas markets or failure to expand into new geographic areas can hinder growth and have a material adverse effect on business, operations and financial prospects.

  • Changes in public healthcare schemes or fluctuations in dental insurance coverage in key markets like the US and the UK can negatively affect business and growth prospects.

Grey Market Premium

The grey market premium of Laxmi Dental's IPO is Rs 163 as of 11:55 a.m., according to InvestorGain. This implies shares of the company will likely list at Rs 591 apiece, indicating a 38.08% premium to the upper end of the price band.

The GMP is not an official price quote for the stock and is based on speculation.

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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.

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