Dr Agarwal’s Healthcare Prepares for IPO
Upcoming IPO: Dr Agarwal’s Healthcare, a leading player in the Indian eye care sector, is gearing up for its initial public offering (IPO) with the backing of prominent investors such as Temasek Holdings and TPG. The company submitted its IPO documentation to the Securities and Exchange Board of India (SEBI) on September 27, marking an exciting new chapter for the healthcare provider.
IPO Details
The proposed IPO consists of a fresh equity share issuance valued at ₹300 crore, coupled with an offer-for-sale (OFS) of 6.95 crore shares by both promoters and investors. Notable shareholders participating in the OFS include Amar Agarwal, Athiya Agarwal, and various family members, as well as institutional investors like Arvon Investments and Claymore Investments—both affiliated with Temasek—and Hyperion Investments, supported by TPG.
Ownership Structure
Currently, the promoters retain a significant stake of 37.83% in Dr Agarwal’s Healthcare. Public shareholders own the remaining shares, with notable institutional holdings: Arvon Investments accounts for 12.45%, Claymore Investments holds 15.73%, and Hyperion Investments possesses a substantial 33.75% stake.
Company Overview
Dr Agarwal’s Healthcare has established a widespread presence with 165 centres across India and an additional 15 centres internationally, providing high-quality eye care services, including cataract surgeries and a range of optical products. As of fiscal year 2024, the company commands approximately 25% of India’s eye care market, demonstrating its leadership and influence in the sector.
Financial Growth and Projections
The Indian eye care industry is poised for robust growth, anticipated to expand at a compound annual growth rate (CAGR) of 12-14%. This growth trajectory is expected to elevate the market size from ₹37,800 crore in FY24 to an estimated ₹55,000-₹65,000 crore by FY28.
Planned Utilization of IPO Funds
Dr Agarwal’s Healthcare has outlined plans to allocate ₹195 crore from the fresh issuance towards reducing existing debt, while the remainder will support corporate objectives and strategic acquisitions. As of July 2024, the company reported a total debt of ₹384 crore, and its debt-to-equity ratio has notably improved, decreasing from 1.3x in FY23 to 0.70x in FY24.
Recent Financial Performance
Financial results indicate a significant growth in revenue, with FY24 reporting a 30.9% increase to ₹1,332 crore. However, net profit saw a slight decline of 7.9%, totaling ₹95 crore largely due to increased tax liabilities. On the brighter side, EBITDA grew by 34%, reaching ₹362.3 crore, leading to a minor improvement in margins at 27.2%.
IPO Management Team
To ensure a successful IPO launch, Dr Agarwal’s Healthcare has engaged a team of reputable advisors, including Kotak Mahindra Capital, Morgan Stanley India, Jefferies India, and Motilal Oswal Investment Advisors, tasked with overseeing the IPO process.
Conclusion
The impending IPO of Dr Agarwal’s Healthcare signifies not only the growth potential of the company but also the expanding landscape of the eye care sector in India. Investors keen on participating in this opportunity should conduct thorough research and consult with financial experts to navigate the dynamics of the market effectively.
