“The issuer has good patient volumes and cost efficiency and its financial profile also shows an increasing trend. The issue is fairly priced at a P/E (price to earnings ratio) of 43 compared to the average industry P/E of 51.93,” said Parth Nyati, who had recommended the Medanta IPO only for long-term investors.
Global Health, operator of Medanta chain of hospitals, soared 19 percent on debut, listing at Rs 398.15 on the BSE and Rs 401 on the NSE. This comes after the IPO was subscribed 9.58 times during November 3-7. Retail investors bid for 88 percent of the allotted quota, non-institutional investors bought their portion 4.02 times, while QIBs booked theirs 28.64 times.
The company engages in cardiology & cardiac science, neurosciences, oncology, digestive and hepatobiliary sciences, orthopedics, liver transplant, and kidney & urology. It was one of the largest private multi-specialty tertiary care providers by bed capacity and operating revenues in FY22. It has centres in Gurugram, Indore, Ranchi, Lucknow, and Patna.
During FY22, the company reported revenue of Rs 2,166 crore as against Rs 1,418 crore in the previous fiscal. During the three-month period ended June 2022, revenue stood at Rs 596 crore against Rs 472 crore a year ago.
This translates to 50 percent growth in FY22 and 27 percent growth in the first quarter of FY23 led by an increase in patient volumes, bed occupancy, and higher average revenue per occupied bed.
The company’s EBIDTA margins have consistently improved over the last two years, led by better margins of mature hospitals (85 percent of revenue) which stood at 22.8 percent in FY22, while EBIDTA margins of new hospitals (making up 15 percent of revenue) improved to 20 percent.
“The issuer has good patient volumes and cost efficiency and its financial profile also shows an increasing trend. The issue is fairly priced at a P/E (price to earnings ratio) of 43 compared to the average industry P/E of 51.93,” said Parth Nyati, who had recommended the Medanta IPO only for long-term investors.
