Suraksha Diagnostic IPO: 5 key things to know ahead of November 29 launch

Suraksha Diagnostic IPO will open for subscription on Friday, November 29. The company aims to raise ₹846.25 crore via its initial public offer.

Ahead of the opening of the subscription window, here are five key things to know about Suraksha Diagnostic IPO:

Suraksha Diagnostic IPO price band, issue size and lot size

Suraksha Diagnostic IPO comprises only an offer-for-sale (OFS) component of 1.92 crore shares.

Suraksha Diagnostic IPO price band has been fixed at ₹420 to ₹441 per share. Retail investors can apply for the issue by placing bids for a minimum single lot size of 34 shares, aggregating to an investment of ₹14,994.

The minimum lot size for small non-institutional investors (sNII) is 14 lots, or 476 shares, amounting to an investment of ₹2,06,388. The lot size for big non-institutional investors (bNIIs) is 67 lots, or 2,278 shares, which translates to a minimum investment of ₹10,04,598.

Suraksha Diagnostic has reserved 50% of the net offer size for the qualified institutional buyers category. The company has also reserved as much as 35% of the net issue for retail individual investors and 15% for the non-institutional investor (NII) category.

Suraksha Diagnostic IPO dates

Suraksha Diagnostic IPO will be available for subscription between November 29 and December 3.

Suraksha Diagnostic IPO share allotment status will likely be finalised on Wednesday, December 4. Subsequent to the allotment of shares, refunds will be initiated for unsuccessful bidders on Thursday, December 5, and successful bidders will receive shares of Suraksha Diagnostic in their Demat accounts on the same day. Shares of Suraksha Diagnostic will be listed on the NSE and BSE.

The tentative listing date for Suraksha Diagnostic shares has been fixed as December 6.

Suraksha Diagnostic IPO: Key financials and competitors

Suraksha Diagnostic’s revenue for the June quarter of FY25 stood at ₹61.85 crore. The company reported a net profit of ₹7.67 crore in Q1FY25. The net worth of the company stood at ₹187.05 crore at the end of the June quarter.

The revenue increased more than 14% to ₹222.26 crore in FY24 against ₹193.69 crore in FY23. The company’s profit-after-tax increased by 281% to ₹23.13 crore in FY24 compared to ₹6.07 crore in FY23. The net worth grew over 15% to ₹179.41 crore from ₹155.93 crore in FY23.

Suraksha Clinic and Diagnostic competes with other diagnostic chains such as Vijaya Diagnostic Centre Limited, Agilus Diagnostics Limited, Dr. Lal Pathlabs Limited, Metropolis Healthcare Limited and Thyrocare Technologies Limited. The company also competes with smaller, independent clinical and anatomical laboratories as well as laboratories owned by hospitals and physicians, including standalone and regional players.

Suraksha Diagnostic business model

Suraksha Clinic and Diagnostic offers a one-stop integrated solution for pathology and radiology testing. The company also offers medical consultation services to its customers through its operational network.

As of June 30, 2024, the company’s operational network consists of its flagship central reference laboratory, 8 satellite laboratories, and 215 customer touchpoints, including 49 diagnostic centres and 166 sample collection centres, across West Bengal, Bihar, Assam, and Meghalaya.

Suraksha Diagnostic IPO: Risk and threats

• Suraksha Clinic and Diagnostic mentioned in its RHP that 95.48% of its revenue from operations in FY24 was generated from West Bengal. The company added that any loss of business in the region could negatively affect its business.
• The diagnostics industry in India is highly competitive and the company’s inability to compete with healthcare service providers can adversely affect its business.
• The company is subject to operational, reputational, medical and legal claims, regulatory actions and other liabilities arising from the provision of healthcare services and can be subject to liabilities arising from claims of malpractice and medical negligence.
• The diagnostic services provider relies on information technology systems and third-party platforms to operate our business, and any disruption to the third-party platform could adversely affect its business.

Suraksha Diagnostic IPO: Key strengths

• Suraksha Diagnostic has a track record of profitability and financial performance.
• The company is an integrated diagnostics provider with a one-stop solution offering pathology and radiology testing and medical consultation services offering over 2,300 tests that cover a range of specialties and disciplines.
• The company’s management team has relevant industry experience as it is led by a team of experienced professionals. - - - Members of the company’s management team have experience in the healthcare industry.
• In its RHP, the company claimed that it has a technologically advanced clinical infrastructure and trained personnel providing diagnostic services.

About Suraksha Clinic and Diagnostic

Suraksha Clinic and Diagnostic, incorporated in 2005, offers pathology, radiology testing, and medical consultancy services. The company has a central reference laboratory with 8 satellite laboratories and 215 customer touchpoints. It also offers online and offline medical consultation services.