Entero Healthcare sets price band for Rs 1,600-cr IPO at Rs 1,195-1,258

Entero Healthcare Solutions IPO dates, price band announced

Haryana-based Entero Healthcare Solutions has set the price band at Rs 1,195-1,258 per share for its Rs 1,600-crore initial public offering.

The IPO will be open for subscription from February 9 to 13, while the bidding for the anchor book will take place for a day on February 8.

This will be the fifth public issue to hit the market this month after Apeejay Surrendra Park Hotels, Rashi Peripherals, Jana Small Finance Bank, and Capital Small Finance Bank.

The healthcare products distributor is planning to raise Rs 1,000 crore through a fresh issue component and Rs 600 crore through the offer-for-sale (OFS) route, at the upper price band.

Corporate promoter OrbiMed Asia III Mauritius, with 38.15 lakh shares, will be the largest selling shareholder in the OFS. The part of the US-based healthcare-focussed investment firm OrbiMed holds 57.27 percent shares in Entero.

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Individual promoters Prabhat Agrawal, and Prem Sethi will be offloading 4.7 lakh and 3.13 lakh equity shares in the OFS, while the remaining 1.7 lakh shares of the total OFS of 47.69 lakh shares will be sold by remaining 16 shareholders.

Entero Healthcare Solutions has reserved Rs 8 crore worth of shares for its employees, who will be getting those shares at a discount of Rs 119 per share to the final offer price.

Up to 75 percent of the net offer (i.e. excluding employee reservation) has been reserved for qualified institutional buyers, 15 percent for high net-worth individuals, and the remaining 10 percent shares for retail investors.

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Investors can bid for a minimum of 11 equity shares and in multiples of 11 shares thereafter. Thus, the minimum application size for retail investors will be Rs 13,838 for 11 shares and their maximum investment in the IPO will be Rs 1,93,732 for 154 equity shares.

The Prabhat Agrawal and Prem Sethi-founded company that created pan-India, technology-driven and integrated healthcare products distribution platform with 77 warehouses across the country for several customers in the pharmacies, hospitals and clinics segments will spend Rs 142.5 crore of the net fresh issue proceeds for repaying debts, and Rs 480 crore for long term working capital requirements.

Further, the remaining fresh issue money will be used for inorganic growth initiatives through acquisitions, and general corporate purposes.

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On the financials front, the healthcare products distributor has turned profitable in the six months ended September FY24, with net at Rs 11.64 crore against loss of Rs 10.86 crore in corresponding period of last fiscal, backed by healthy operating numbers. Revenue from operations during the same period increased by 19.7 percent to Rs 1,895.5 crore.

In the last financial year 2022-23, it had posted loss of Rs 11.1 crore, narrowing from loss of Rs 29.4 crore in previous year. Revenue from operations grew by Rs 30.85 percent to Rs 3,300 crore during the same period.

Entero Healthcare Solutions, one of the top three healthcare products distributors in India in terms of revenue in FY22, will finalise the basis of allotment of IPO shares by February 14, and the shares will be credited to the demat accounts of eligible investors by February 15.

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Trading in its equity shares are likely to start on the BSE and the NSE from February 16.