Shanmuga Hospital shares hit 5% lower circuit after flat listing on BSE SME

Shanmuga Hospital Ltd made a muted trading debut on Friday, February 21, with its shares listing flat on the BSE SME platform.

Shares of the company opened at ₹54 apiece, the same as the IPO price, on the BSE SME platform. Soon after listing the stock declined a further 5% to hit the lower circuit limit at ₹51.3 apiece.

As many as 1.14 lakh shares of the company changed hand on the BSE by 10:10 am. The total turnover stood at ₹60.48 lakh. The company’s market capitalisation reached nearly ₹70 lakh.

At the listing price of ₹54 per share, the IPO investors did not make any gain or loss as the stock price remained unchanged over the issue price. However, with the stock hitting the 5% lower circuit Shanmuga Hospital IPO investors would have faced a potential loss of ₹5,400 per lot as the value of a single lot of equity shares dropped to ₹1,02,600 (₹51.3 x 2,000).

The minimum investment in the IPO per lot size was ₹1,08,000 (₹54 x 2,000).

The multi-speciality hospital operator raised ₹20.62 crore through its initial public offering this week. The fixed-price IPO, which comprised only a fresh issue of 38.18 lakh shares, was open for subscription from February 13 to February 17. The BSE SME IPO price was fixed at ₹54 per share.

Riding on decent demand from investors, the IPO was booked 2.55 times on the final day of the offer. The SME IPO garnered applications for 92.56 lakh shares compared to 36.26 lakh shares on offer.

The retail portion was booked 4.4 times with applications for 79.7 lakh equity shares against 18.13 lakh equity shares reserved for the category.

The Non-Institutional Investors’ (NIIs) segment was booked 70% as applications for 12.86 lakh shares were received against 18.13 lakh shares on offer.

Shanmuga Hospital Limited operates a multispecialty hospital in Salem, Tamil Nadu. The hospital has a capacity of 151 beds equipped with the latest healthcare technology. The facility encompasses an Oncology Unit, Emergency Department (ED), High Dependency Unit (HDU), Cardiac Care Unit (CCU), Intensive Care Unit (ICU), Neonatal Intensive Care Unit (NICU) and Outpatient Consultation Services.

Its diagnostic centre features a modern laboratory and imaging technologies such as X-ray, Ultrasound, Computed Tomography (CT) scan, Magnetic Resonance Imaging (MRI), and modular operational theatres.

The multispeciality hospital has proposed to use ₹14.52 crore of the IPO proceeds to fund expenditure on the purchase of additional medical equipment Computed Tomography (CT) scanner and Robotic Surgical Systems. Currently, it has placed orders for the equipment for which the estimated total cost approximately amounts to ₹14.52 crore. No payments have been made towards these items as of now. The company has earmarked ₹3.83 for general corporate purposes.

Shanmuga Hospital reported a total revenue of ₹24.83 crore for the April-September period of FY 2024-25. Its profit after tax (PAT) during the period stood at ₹2.39 crore. The hospital posted a total revenue of ₹43.39 crore for the financial year ended on March 31, 2024, while the net profit stood at ₹5.26 crore.