Subscription to the South Indian Nidan Series, Vijaya Diagnostic Center was opened on 1 September. This leaves potential investors wondering whether they should subscribe to the public issue or not. The Rs 1,895.40 crore issue will remain open for three days and will close on September 3 after trading. The basis of allotment for the company has been fixed on September 8, while IPO Ready to be listed on the stock exchanges on September 14, 2021.
NS Vijaya Diagnostic Center IPO It has an issue size of Rs 1,895 and is an offer for sale (OFS) with a completely similar price. The public issue consists of approximately 35,688,064 equity shares with a face value of Re 1 per equity share. The IPO price ranged from Rs 522 to Rs 531 per equity share and is a book-built issue IPO. The company is looking to sell its shares and listing on the National Stock Exchange (NSE) and Bombay Stock Exchange (BSE).
As per information in IPO Watch, the gray market premium for the issue was Rs 20 per equity share. This indicates that the shares were trading at a premium of Rs 542 to Rs 551 in the unlisted gray market on the first day of the issue.
The bottom half of the public issue had a lot size of 28 shares with an application amount of Rs 14,868. The lot size at the higher level was at 364 shares, with the maximum application amount being Rs 193,284. Retail Individual Investors (RIIs) can apply up to 13 lots subject to the upper limit of lot size. Coming to the investor categories, RII had allocated 35 per cent for its IPO reservation. On the other hand, Qualified Institutional Buyers (QIBs) got the highest reservation at 50 per cent. Non-institutional investors (NIIs) had a 15 per cent reservation for IPOs. Similarly, employees also got a discount of Rs 52 per equity share.
The company had raised around Rs 566 crore from anchor investors before its IPO. According to the circular uploaded on the BSE website, the company had allotted 1,066,141 equity shares to 29 anchor investors at Rs 531 per share.
Speaking on the position of Vijaya Diagnostic Center in the industry, India Infoline Finance Limited (IIFL) Securities said in a note, “As per the CRISIL report, the Indian diagnostics market was valued at Rs 710 billion to Rs 730 billion in the financial year. It is projected to grow at a CAGR of around 12% to 13% to reach Rs.920 billion to Rs.980 billion by FY2023, by 2021, and increase in health awareness and disposable income, increase demand for better healthcare facilities and quality. care of individuals, and increased spending on preventive and wellness.”
The promoter of the issue was Dr. S. Surendranath Reddy, who is also the Chief Executive Officer (CEO) of the fast growing diagnostics chain. Vijaya Diagnostic Center was established in 1981 and is considered as one of the fastest growing diagnostics chain in South India. The company provides a wide range of services in the areas of pathology and radiology with approximately 740 routine tests, 870 specialized pathology tests, 220 basic tests and 320 advanced radiology tests. It has a strong network of 80 diagnostic centers and 11 reference laboratories which are present in 13 cities and towns in the states of Telangana, Andhra Pradesh, National Capital Region and Kolkata.
“At the upper price band, Vijaya Diagnostic Center Ltd. is seeking a PE multiplier of 64.3X FY21 earnings, lower than the industry average of 90.8X. Taking into account the future growth potential of the healthcare industry, revenue from operations, EBITDA and PAT growth, during FY19 to FY21, at a CAGR of 13.5%, 23.9% and 35.5%, respectively, finance Strong ROE and ROCE of 23.64% and 42% respectively in the year 2011, debt free company with acquisition and expansion plans, diversified service offerings and strong technical capabilities of the company, said IIFL Securities, we approach the issue with long term perspective Recommend to ‘subscribe’.
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