Yatharth Hospital IPO subscribed 5.8 times on day 3 so far; issue closes today
Yatharth Hospital is selling its shares through primary route in the range of Rs 285-300 apiece with a lot size of 50 equity shares between July 26 to July 28.
- Jul 28, 2023,
- Updated Jul 28, 2023 12:40 PM IST
The Rs 687-crore initial public offering (IPO) of Yatharth Hospital and Trauma Care Services saw a mildly positive demand from the investors on the third and the final day of the bidding. The issue was subscribed 5.25 times on the second day of bidding, while it was booked 1.51 times on day one. Yatharth Hospital is selling its shares in the range of Rs 285-300 apiece during the three-day bidding process and investors can make a bid of a minimum of 600 equity shares and its multiples thereafter. The issue includes a sale of fresh equity shares worth Rs 490 crore and an offer-for-sale of around 65.52 lakh equity shares . According to the data, the investors made bids for 9,58,35,100 equity shares, or 5.80 times, compared to the 1,65,17,823 equity shares offered for the subscription by 12.15 pm on Friday, July 28, 2023. The quota for retail investors was booked 5.08 times, whereas the allocation for non-institutional bidders fetched 13.10 times bids, while QIB portion was booked 1.49 times Incorporated in 2008, Yatharth Hospital is a hospital chain which operates four-super specialty hospitals located in Noida, Greater Noida, and Noida Extension. The company acquired a 305-bedded multi-specialty hospital in Orchha, Madhya Pradesh to extend its operations and services. Brokerage firms are mostly positive on the issue and have suggested subscribing for the issue. However, select brokerage firms are skeptical over the issue on the back of high fixed cost, debt-heavy operational expenses, dependency on select special facilities and government deals compressing the margins. Number of occupied beds and ARPOB grew by 13 per cent and 12 per cent CAGR respectively over FY21-23; which led to a 51 per cent CAGR growth in company’s revenue. EBITDA grew at a CAGR of 41 per cent over the aforementioned period. India’s current healthcare expenditure is largely dominated by private expenditure, said Nirmal Bang Securities. "North India regions have lower than average doctor and nurse density per 10,000 population. This is expected to improve going ahead, favouring the company's expansion plans. Yatharth’s recent acquisition of Jhansi-Orchha is aimed at further expanding into new geographies and to grow their presence into the regional healthcare market," it added with a subscribe tag. Ahead of the IPO, Yatharth Hospital allocated 68,65,506 equity shares to 18 anchor investors at a price of Rs 300 apiece to raise Rs 205.96 crore. Marquee investors included ICICI Prudential, Nippon Life, HDFC Mutual Fund, Aditya Birla Sun Life, Bandhan Mutual Fund, HSBC Global Investment, Troo Capital, Carnelian Capital, BNP Paribas, Goldman Sachs and Jupiter India Fund among others. The hospital continually looks for value-accretive opportunities while strengthening the presence in key growth markets by expanding the network of hospitals owned and operated by them through brownfield or greenfield. projects, strategic acquisitions, and arrangements with third party service providers, said Anand Rathi Shares and Stock Brokers in its IPO note. At the upper price band company is valuing at P/E of 39 times FY23 earnings with a market cap of Rs 2,576 crore post issue of equity shares and return on net worth of 35.9 per cent. We believe that the issue is fairly priced and recommend 'subscribe for long term' rating to the IPO, it added. 50 per cent of the issue is reserved for the qualified institutional bidders (QIBs), while non-institutional investors (NIIs) will get 15 per cent of the shares. Remaining 35 per cent shares shall be allocated to the retail investors. Around 80 per cent of Yatharth's operating beds are present in the highly competitive market of Delhi-NCR region. Ramraja Hospital is operating at lower bed occupancy levels and is currently loss making. Thus we are cautiously optimistic on the medium-term performance of the company, said Choice Broking. "At the higher price band, Yatharth is demanding a P/E multiple of 39.2 times, which seems to be in-line to the peer average. Considering the above observations, we assign a 'subscribe with caution' rating for the issue," it added. Intensive Fiscal Services, Ambit and IIFL Securities are the book running lead managers to the issue, while Link Intime India has been appointed as the registrar to the issue. The stock will be listed on both BSE and National Stock Exchange (NSE), with August 7 as the tentative date of listing.
Also read: Hot stocks on July 28, 2023: Escorts Kubota, Intellect Design, RBL Bank, RVNL and more
The Rs 687-crore initial public offering (IPO) of Yatharth Hospital and Trauma Care Services saw a mildly positive demand from the investors on the third and the final day of the bidding. The issue was subscribed 5.25 times on the second day of bidding, while it was booked 1.51 times on day one. Yatharth Hospital is selling its shares in the range of Rs 285-300 apiece during the three-day bidding process and investors can make a bid of a minimum of 600 equity shares and its multiples thereafter. The issue includes a sale of fresh equity shares worth Rs 490 crore and an offer-for-sale of around 65.52 lakh equity shares . According to the data, the investors made bids for 9,58,35,100 equity shares, or 5.80 times, compared to the 1,65,17,823 equity shares offered for the subscription by 12.15 pm on Friday, July 28, 2023. The quota for retail investors was booked 5.08 times, whereas the allocation for non-institutional bidders fetched 13.10 times bids, while QIB portion was booked 1.49 times Incorporated in 2008, Yatharth Hospital is a hospital chain which operates four-super specialty hospitals located in Noida, Greater Noida, and Noida Extension. The company acquired a 305-bedded multi-specialty hospital in Orchha, Madhya Pradesh to extend its operations and services. Brokerage firms are mostly positive on the issue and have suggested subscribing for the issue. However, select brokerage firms are skeptical over the issue on the back of high fixed cost, debt-heavy operational expenses, dependency on select special facilities and government deals compressing the margins. Number of occupied beds and ARPOB grew by 13 per cent and 12 per cent CAGR respectively over FY21-23; which led to a 51 per cent CAGR growth in company’s revenue. EBITDA grew at a CAGR of 41 per cent over the aforementioned period. India’s current healthcare expenditure is largely dominated by private expenditure, said Nirmal Bang Securities. "North India regions have lower than average doctor and nurse density per 10,000 population. This is expected to improve going ahead, favouring the company's expansion plans. Yatharth’s recent acquisition of Jhansi-Orchha is aimed at further expanding into new geographies and to grow their presence into the regional healthcare market," it added with a subscribe tag. Ahead of the IPO, Yatharth Hospital allocated 68,65,506 equity shares to 18 anchor investors at a price of Rs 300 apiece to raise Rs 205.96 crore. Marquee investors included ICICI Prudential, Nippon Life, HDFC Mutual Fund, Aditya Birla Sun Life, Bandhan Mutual Fund, HSBC Global Investment, Troo Capital, Carnelian Capital, BNP Paribas, Goldman Sachs and Jupiter India Fund among others. The hospital continually looks for value-accretive opportunities while strengthening the presence in key growth markets by expanding the network of hospitals owned and operated by them through brownfield or greenfield. projects, strategic acquisitions, and arrangements with third party service providers, said Anand Rathi Shares and Stock Brokers in its IPO note. At the upper price band company is valuing at P/E of 39 times FY23 earnings with a market cap of Rs 2,576 crore post issue of equity shares and return on net worth of 35.9 per cent. We believe that the issue is fairly priced and recommend 'subscribe for long term' rating to the IPO, it added. 50 per cent of the issue is reserved for the qualified institutional bidders (QIBs), while non-institutional investors (NIIs) will get 15 per cent of the shares. Remaining 35 per cent shares shall be allocated to the retail investors. Around 80 per cent of Yatharth's operating beds are present in the highly competitive market of Delhi-NCR region. Ramraja Hospital is operating at lower bed occupancy levels and is currently loss making. Thus we are cautiously optimistic on the medium-term performance of the company, said Choice Broking. "At the higher price band, Yatharth is demanding a P/E multiple of 39.2 times, which seems to be in-line to the peer average. Considering the above observations, we assign a 'subscribe with caution' rating for the issue," it added. Intensive Fiscal Services, Ambit and IIFL Securities are the book running lead managers to the issue, while Link Intime India has been appointed as the registrar to the issue. The stock will be listed on both BSE and National Stock Exchange (NSE), with August 7 as the tentative date of listing.
Also read: Hot stocks on July 28, 2023: Escorts Kubota, Intellect Design, RBL Bank, RVNL and more