GPT Healthcare IPO: 10 things to know before you buy into Rs 525-cr issue

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Operating a chain of mid-sized, multi-speciality, full-service hospitals in Eastern India, GPT Healthcare Limited will float its public issue as a mix of a fresh shares and an offer-for-sale on February 22 and the anchor book will open on February 21.

Let's check out the key details of the issue...

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1. IPO Dates

The IPO will open for subscription on February 22, 2024 and close on February 26, 2024.

2. Price Band 

The price band for the issue has been fixed at Rs 177-186 per share.

3. Offer Details

The price band for the IPO, which will close for subscription on February 26, has been fixed at Rs 177-186 per share. The company aims to raise around Rs 525.14 crore through a fresh issue of 21.5 lakh shares worth Rs 40 crore and an offer-for-sale of 2.6 crore shares worth Rs 485.14 crore.

BanyanTree Growth Capital II LLC will be selling its entire shareholding of over 2.60 crore equity shares, representing 32.64 percent of the paid-up equity. With this, the Mauritius-based private equity fund will exit the company.

4. Objectives of the Issue

The company proposes to utilise the net proceeds towards repayment or prepayment of certain outstanding borrowings availed by GPT Healthcare from banks and financial institutions and the rest for general corporate purposes.

5. Lot Size

Investors can bid for a minimum of 80 equity shares and in multiples thereof. Hence the minimum investment by retail investors would be Rs 14,160 (80 (Lot size) x 177 (lower price band)). At the upper end, the bidding amount will increase to Rs 14,880.

6. Company Profile

Established in 1989, GPT Healthcare Limited manages a series of medium-sized, comprehensive hospitals in Eastern India under the brand ILS Hospitals. The company, headquartered in Kolkata, West Bengal, specializes in delivering integrated healthcare services with a focus on secondary and tertiary care. Operating in over 35 specialties and super-specialties, the company provides a diverse range of healthcare services.

7. Financials of the Company

The company's net profit recorded a CAGR of 36 percent to Rs 39 crore and EBITDA 20.53 percent to Rs 80 crore for the year ended FY23. CAGR stands for compounded annual growth rate. Net profit during the six months ended FY24 grew 38.3 percent on-year to Rs 23.5 crore and revenue in the same period grew 18.7 percent to Rs 204.2 crore.

8. Lead Managers

Jm Financial Limited is the book-running lead manager of the GPT Healthcare IPO, while Link Intime India Private Ltd is the registrar for the issue.

9. Key Risks

(i) The company derives approximately 70 percent of its revenue from hospitals in West Bengal as these serve a significant percentage of GPT's patients. All hospitals are located in the eastern region of India and any impact on the revenue from these hospitals or any change in the economic or political conditions of West Bengal could materially affect business.

(ii) The company outsources various service functions to third-party contractors. Any lapse by such third-party service providers may have adverse consequences on the business and reputation. For instance, it uses a third-party hospital information management software system to assist with functions including managing patient interface, invoicing, and stock management.

(iii) Certain lands on which two hospital buildings are operating are not owned by GPT but are leased on a long-term basis. Any adverse impact on the title or ownership rights of the owner or breach of the terms or non-renewal of the lease agreement on commercially favourable terms or at all may lead to disruptions.

10.  Listing Date

GPT Healthcare IPO will be listed on BSE and NSE with a tentative listing date fixed as Thursday, February 29, 2024.

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