Yatharth Hospital IPO GMP, Subscription, Review; Should You Buy on Last Day?

Yatharth Hospital IPO Subscription Day 3: The initial public offering (IPO) of Yatharth Hospital and Trauma Care Services continued to get a good response from investors on the second day of bidding, as well, with the offer subscribed 3.03 times. The IPO opened for subscription on Wednesday, 26 July, and close on Friday, 28 July. Yatharth Hospital and Trauma Care Services are looking to raise about Rs 687 crore via primary markets, which includes a sale of fresh equity shares worth Rs 490 crore and an offer for sale (OFS) of around 65.52 lakh equity shares by its promoters including Vimla Tyagi, Prem Narayan Tyagi, and Neena Tyagi.

Subscription Status: By evening, bids had come in for 5.01 crore equity shares against the IPO size of 1.65 crore shares.

High networth individuals (HNIs) and retail investors have bought 5.85 times and 3.36 times their allotted quotas, while qualified institutional buyers (QIBs) bid for 29 per cent of the shares set aside for them.

Half of the issue, which closes July 28, has been reserved for QIBs, 15 per cent for HNIs and the remaining 35 per cent for retail investors.

Yatharth Hospital IPO price band: The company has fixed the price band at Rs 285 to Rs 300 per equity share for the proposed initial public offer.

Issue Details and Yatharth Hospital IPO Size: Yatharth Hospital IPO consists of a fresh issuance of shares for Rs 490 crore and an offer by the promoters Vimla, Prem Narayan, and Neena Tyagi to sell 65.51 lakh equity shares.

Yatharth Hospital IPO Lot Size: Bids can be made for a minimum of 50 equity shares and in multiples of 50 equity shares thereafter.

Yatharth Hospital IPO Objective: Yatharth Hospital IPO intends to use the net proceeds to pay off or advance debt, Fund capital expenditure expenses for the company’s two hospitals, Noida Hospital and Greater Noida Hospital, as well as for the hospitals run by the company’s subsidiaries AKS and Ramraja. Additionally, fund inorganic growth initiatives through acquisitions and general corporate purposes.

Yatharth Hospital IPO Reservation: Yatharth Hospital IPO has reserved not more than 50 per cent of the shares in the public issue for Qualified Institutional Buyers (QIB), not less than 15 per cent for Non Institutional Investors (NII), and not less than 35 per cent of the offer is reserved for Retail Investors.

Allotment and Listing of Yatharth Hospital IPO Details: The basis of allotment of shares will be finalised on Wednesday, 2 August and the company will initiate refunds on Thursday, 3 August, while the shares will be credited to the demat account of allottees on Friday, 4 August. Yatharth Hospital IPO shares are likely to be listed on BSE and NSE on Monday, 7 August.

Link Intime India Private Ltd is the registrar to the public offer. The three book running lead managers associted with the offer are Intensive Fiscal Services Private Ltd, Ambit Private Ltd, and IIFL Securities Ltd.

Yatharth Hospital IPO GMP Today: According to topsharebrokers.com, Yatharth Hospital IPO grey market premium (GMP) today is Rs 50. This indicates that Yatharth Hospital shares were trading at a premium of Rs 50 in the grey market on Wednesday.

Should you invest?

Brokerage firms are mostly positive on the issue and have suggested subscribing for the issue. However, select brokerage firms are skeptical over the issue on the back of high fixed cost, debt-heavy operational expenses, dependency on select special facilities and government deals compressing the margins. Here’s what a host of brokerage firms said about the issue:

“India’s current healthcare expenditure is largely dominated by private expenditure. North India regions including Haryana and Uttar Pradesh have lower than average doctor and nurse density per 10,000 population. This is expected to improve going ahead, favouring company’s expansion plans,” Nirmal Bang said.

The company intends to focus on more advanced specialties, with high demand and deliver a higher ARPOB. With high ROE and ROCE of 36 percent and 24.4 percent, the brokerage said Yatharth is being offered at a reasonable valuation of 20.9x FY23 EV/EBITDA as compared to its peers.

With healthy financials along with growth potentials in northern India, Nirmal Bang recommends subscribing to the issue.