Shares of Yatharth Hospital and Trauma Care Services made a muted debut on the stock exchanges on Monday, lower than Street estimation, with the share price of multi-specialty hospital chain opening at ₹306.1, up 2% against the upper end of the IPO price band of ₹285-300 on the NSE. In a similar trend, the stock debuted at ₹304 on the BSE. Given the current momentum in the primary market and decent subscription from investors, analysts were expecting the stock to list at a premium of 25% as it was commanding a premium of ₹75 in the grey market.
However, the healthcare stock gained momentum post listing and gained as much as 13.6% to ₹341 on the NSE, while it hit a high of ₹340.9 on the BSE. A total of 1.18 crore shares changed hands over the counters on the BSE and the NSE, whereas the market capitalisation rose to ₹2,862 crore.
The ₹686.55 crore intial public offering (IPO) of Yatharth Hospital had managed to garner strong response from investors, especially by qualified institutional buyers (QIBs) and non institutional investors (NIIS), with the issue subscribing by 36.16 times. The quota reserved for QIBs were booked 85.1 times, while the portion for NIIs were subscribed 37.22 times. The category for retail individual investors (RIIs) received 8.34 times bid. As per the document filed with capital market regulator SEBI, the Noida-based hospital chain had reserved up to 50% of the shares for QIBs, up to 15% for NIIs, and remaining 35% for retail investors.
The IPO, which opened between July 26-28, comprised of a fresh issuance of equity shares of ₹490 crore and an offer for sale (OFS) of ₹197 crore by the promoters Vimla, Prem Narayan, and Neena Tyagi, who proposed to sell 65.51 lakh equity shares.
The company intends to use funds raised from issuing of fresh equity shares to pay off debt, fund capital expenditure expenses of its two hospitals, as well as to fund inorganic growth initiatives through acquisitions and general corporate purposes. It will use ₹245 crore for the repayment or prepayment of borrowings, ₹132.6 crore for funding capital expenditure expenses of the company and its subsidiaries, ₹65 crore for funding inorganic growth initiatives and for general corporate purposes.
Incorporated in 2008, Yatharth Hospital and Trauma Care Services Limited is a private super-speciality hospital chain located in the National Capital Region (NCR) of Delhi. The company operates three super-speciality hospitals in the Delhi NCR, specifically in Noida, Greater Noida, and Noida Extension, Uttar Pradesh. Yatharth has acquired a 305-bedded multi-speciality hospital in Orchha, Madhya Pradesh (commenced operations in FY22), making it one of the largest hospitals in the Jhansi-Orchha-Gwalior region in terms of bed capacity. As of March 31, 2023, Yatharth has a team of 609 doctors, offering healthcare services across various specialities and super-specialities.
Ahead of the IPO, the company raised ₹120 crore by placement of 40,00,000 equity shares for cash at a price of ₹300 per share (including a share premium of ₹290 per share). The company, while filed for IPO in March last year, allotted shares to Plutus Wealth Management LLP, Think India Opportunities Master Fund, Vikas Vijaykumar Khemani, Rosy Blue Diamonds Pvt. Ltd., and Viraj Russell Mehta.
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