Krishna Diagnostics Limited It is one of four companies to enter the market with an initial public offering (IPO). The company is eyeing an issue size of Rs 1,213.33 crore next week. Krishna Diagnostics was incorporated in 2010 and has been termed as one of the fastest growing diagnostic chains in India. It offers a wide range of diagnostic services to its customer base like Imaging/Radiology services (X-ray, MRI, etc.), routine diagnostic laboratory tests, pathology and teleradiology services. The primary target audience for these services are private and public hospitals, medical colleges, and community health centers.
With Krishna Diagnostics IPO Just around the corner, here are 10 things you should know about the public issue before it starts in August.
1) Krishna Diagnostics IPO Overview
Krishna Diagnostics is eyeing Rs 1,213 crore earnings on the issue opening day. NS IPO This includes a new issue as well as an Offer for Sale (OFS). The fresh issue was listed at Rs 5 per equity share aggregating up to Rs 400. The OFS, on the other hand, was listed with 8,525,520 equity shares as Rs 813.33 crore with a face value of Rs 5 per share.
2) Krishna Diagnostics Gray Market Premium (GMP) and Price Band
The GMP for the company’s IPO was listed as Rs 450 on IPO Watch on July 31. This means the IPO was trading at a premium of Rs 1,383 to Rs 1,404 per equity share on the gray market. This stands against the issue’s price band which was listed as Rs 933 to Rs 954 per equity share.
3) Important Pre-IPO Dates
The issue is scheduled to open on August 4. It will be open for subscription for 3 trading days, the day it closes on 6th August. Any anchor bookings are likely to happen on August 3rd, a day before they open.
4) Krishna Diagnostics Allotment, Listing Date
The basis of allotment is likely to be a day after the company closes its subscription. The date for allotment so far is August 11. Next day on 12th August, refund will be started. Successful bidders will see their shares getting credited in their respective demat accounts on August 13. The listing date is likely to be August 17, however, it is yet to be confirmed.
5) IPO Subscription Status (Club Lot Size and Subscriptions)
The IPO has a minimum lot size of 15 shares with Rs 14,310 as the minimum application amount. The high end of the issue lot is at 195 shares, with a limit of Rs 186,030 as application amount. In this lot, retail investors have been given an allotment of 13 lots, for which they can apply at the upper limit.
As far as the share of investors is concerned, the IPO has given a reservation of 75 per cent to Qualified Institutional Buyers (QIBs). Non-institutional investors (NIIs) have a reservation of 15 per cent while retail investors have an allocation of 10 per cent.
6) Objective of the offer
The company aims to use the proceeds of the public issue to finance the cost of setting up new diagnostic centers in Punjab, Karnataka, Himachal Pradesh and Maharashtra. A certain part of the funds will go fully or partially for repayment and pre-payment of the company’s borrowings. Finally, a portion of the proceeds will go toward other general corporate expenses.
7) Promoter and other details
The promoter of the IPO is Rajendra Mutha, who is the chairman of Krishna Diagnostics Limited. The lead managers to the issue will be JM Financial, DAM Capital Advisors, Equirus Capital and IIFL Securities. The official registrar for the IPO is KFin Technologies Private Limited.
8) Company Profile
Krishna Diagnostics Limited is a fast growing diagnostics chain with its roots in India. It has a vast network of clients that it offers various diagnostic services. These services include imaging/radiology services (X-rays, MRIs, etc.), routine diagnostic laboratory tests, pathology and teleradiology services. Even though it has a vast network, its main focus is on non-metro, low-lying cities and towns. As of December 31, the company has over 1,801 clinical centers providing radiology and pathology services in 13 different cities.
9) Company Financial
The company’s income for the financial year ended March 3, 2020 was Rs 271.38 crore. As mentioned by Angel Broking, it is in an upward trend from last year’s Rs.214.31 crores. Also, the company’s net loss also increased to Rs 111.95 crore from Rs 58.05 crore last year.
Keeping this in view, it is pertinent to mention that Krishna Diagnostics reported an increase in net profit and revenue for the nine-month period ended December 31, 2020. Net profit for the period stood at Rs 195.93 crore and revenue was Rs 562.7 crore, according to Angel Broking. This has come in the light of sharp reduction in expenditure and higher revenue from operations due to the ongoing pandemic.
10) Competitive Strength of Krishna Diagnostics Limited
Krishna Diagnostics has some notable competitive strengths. For one, it is one of the leading diagnostic chains in India. There is also a wide and diverse range of services in the field of diagnostics. It has a wide market presence due to its complex network and presence in 13 cities. The company has also shown good financial track record.
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