Rainbow Children’s Medicare IPO (Initial Public Offering) opened for subscription at present. The Rs 1,581 crore public difficulty will stay open for subscription until Friday night. Rainbow Children’s Medicare is a multi-speciality pediatric, obstetrics and gynecology hospital chain in India. The IPO of the corporate will likely be a mixture of recent issuance of fairness shares and a suggestion on the market (OFS) by current shareholders. Ahead of the problem, Rainbow Children’s Medicare has raised Rs 470 crore from 36 anchor traders. Rainbow Children’s Medicare IPO is the second difficulty of the present fiscal 12 months.
Issue particulars
Investors can bid for the IPO from at present in a hard and fast value band of Rs 516-542 per share. Bids may be positioned in quite a bit measurement of 27 fairness shares and multiples thereafter. At the higher finish of the value band, the minimal funding wanted by traders to bid for the IPO is Rs 14,634. The IPO consists of a recent difficulty of 51,66,052 fairness shares of face worth Rs 10 every. Further, 2,40,00,900 fairness shares will likely be offered by current shareholders of the corporate. This consists of the promoters of the corporate, Ramesh Kancharla and Dinesh Kumar Chirla.
Post difficulty the promoter group shareholding will come all the way down to 49.8% from the present 62.2% whereas the general public shareholding within the firm will improve to 50.2% from 37.8%.
Through the funds raised by the recent difficulty of fairness shares, Rainbow Children’s Medicare intends an early redemption of NCDs issued by the Company and use the funds for capital expenditure in direction of establishing of latest hospitals and buy of medical gear for such new hospitals. 50% of the problem is reserved for Qualified Institutional Buyers (QIB) whereas 35% is reserved for retail traders and 15% for Non-Institutional Investors.
Analysts bullish on prospects
ICICI Direct: Subscribe
“Rainbow Children’s Medicare has a focused children centric approach. The target market is expected to grow at a CAGR of 14% till FY26,” mentioned ICICI Direct in a be aware. Analysts mentioned that will probably be key for Rainbow to maintain its progress trajectory amid elevated consolidation in healthcare house and margin profile. “At the upper price band, it is valued at ~36.4x EV/EBITDA for FY21 and ~22.9x EV/EBITDA for 9MFY22,” they added whereas pinning a ‘Subscribe’ ranking on the problem given its distinctive mannequin and first rate valuation.
Ashika Research: Subscribe
Analysts mentioned that by way of the valuations, on the upper value band, Rainbow Children’s Medicare calls for a P/E a number of of 32.6x based mostly on the primary 9 months of the earlier fiscal 12 months submit difficulty absolutely diluted EPS and EV/EBITDA a number of of 25.3x based mostly on 9MFY22 submit difficulty absolutely diluted EBITDA. The trade P/E and EV/EBITDA is ~50x and ~30x which signifies that the IPO is suitably priced. “Given the growth in the healthcare segment, dominant presence in southern India, strong financials, expansion to new services and diversifying to new areas, will drive the company’s performance going forward. Hence, it is recommended to “SUBSCRIBE” the problem from the long run perspective,” they added.
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The brokerage agency highlighted that Rainbow Children’s Medicare will command a P/E Ration of 43.16x whereas friends similar to Apollo Hospitals commerce at 77.3x and Fortis Healthcare is at 56.9x. In the monetary 12 months 2020-21 the corporate had a income of Rs 6,500 million, and complete bills of Rs 6,046 million. “The company operates in a regulated industry, and compliance with applicable safety, health, environmental, labour, and other regulations or failure to obtain or renew approvals, licenses, registrations and permits, may adversely affect the business,” analysts mentioned whereas highlighting dangers aligned with the corporate.
Source: www.financialexpress.com”