Dr Agarwal's Healthcare IPO sees poor demand, booked only 7% on Day 1; check key details

The eye-care services provider aims to raise ₹3,027.26 crore from the primary market through its IPO. The book-building issue is open for subscription till Friday, January 31.

As per the NSE data at the end of the first day of bidding at 5 pm, the issue received applications for more than 38.08 lakh shares against 5.35 crore shares on offer.

The retail portion of the IPO was subscribed 11% with bids for over 28.93 lakh shares against 2.54 crore shares reserved for the category. The Non-Institutional Investors (NIIs) subscribed only 6% of their quota of nearly 1.09 crore shares by applying for over 6 lakh shares. The Qualified Institutional Buyers (QIBs) submit bids for 18,375 shares compared to the allocation of over 1.45 crore shares.

The company’s employees’ segment was booked 8% with bids for nearly 1.34 lakh shares against the allocation of over 15.79 lakh shares. In the shareholders’ category, the company has allocated over 11.29 lakh shares. The shareholders subscribed 14% of their quota with bids for 1.63 lakh shares. Here’s a look at all the key details about the issue for the investors interested in applying for the shares of Dr Agarwal’s Healthcare Ltd.

Dr Agarwal’s Healthcare raises ₹875.51 crore from anchor investors

Ahead of the launch of its IPO, Dr Agarwal’s Healthcare raised ₹875.51 crore from anchor investors on January 28.

According to the circular on the stock exchanges, the company allotted 2.17 crore shares to 14 anchor investors at an allocation price of ₹402 per equity share.

Dr Agarwal’s Healthcare IPO price band and other key details

Dr Agarwal’s Healthcare IPO consists of a fresh issue of 74.62 lakh shares, worth up to ₹300 crore, and an offer-for-sale (OFS) of 6.78 crore shares, aggregating up to ₹2,727.26 crore.

The company has fixed the price band at ₹382 to ₹402 per share for the IPO. The minimum lot size is 35 shares.

Kotak Mahindra Capital Company Ltd, Morgan Stanley India Company Pvt. Ltd, Jefferies India Pvt. Ltd, and Motilal Oswal Investment Advisors are the book-running lead managers of Dr. Agarwal’s Healthcare IPO. Kfin Technologies Ltd is the registrar for the issue.

Dr Agarwal’s Healthcare IPO dates

The IPO allotment status is expected to be finalised on Monday, February 3. Refunds will be issued on Tuesday, February 4, and the allottees will also receive shares in their Demat accounts on the same day.

The company has proposed to list its shares on the NSE and BSE on Wednesday, February 5.

About Dr Agarwal’s Healthcare Ltd

Dr Agarwal's Healthcare Ltd provides various services, including refractive, cataract and other surgeries. The company also provides non-surgical treatments, consultations and diagnostic services. It’s also engaged in the sale of optical products, accessories, contact lenses and eye-related pharmaceutical items.

As of September 2024, it had a network of 193 facilities, with a majority concentration in the southern part of India, particularly Hyderabad, Bengaluru, and Chennai, followed by Western India. It also operates 16 facilities in the African market.

The share of organised eye care services is only 13-15% of the total eye care market, indicating significant headroom for consolidation and growth within this segment. Also, the African market’s growing healthcare needs provide a platform for further international growth. The company’s hub-and-spoke model enables access to underserved areas, with 123 193 facilities in high-growth Tier-II and Tier-III cities.

Use of IPO proceeds

As per the healthcare company’s RHP, ₹195 of the net proceeds from the issue will be used for the repayment or prepayment of certain borrowings in full or in part. A portion of the remaining amount will be used for general corporate needs or unidentified inorganic acquisitions, not exceeding 25% of the gross proceeds of the issue.

Dr Agarwal’s Healthcare Finances

For the six-month period ended September 30, 2024, the company’s total revenue stood at ₹837.94 crore. It reported a profit after tax (PAT) of ₹39.56 crore during H1FY25.

For the financial year ended March 31, 2024, Dr Agarwal's Health Care’s revenue was recorded at ₹1,376.44 crore compared to ₹1,031.49 crore in the preceding fiscal (FY23). The profit after tax (PAT) for FY24 dropped to ₹95.05 crore compared to ₹103.23 crore in FY23.