Vijaya Diagnostic Centre Limited had seen its initial public offering (IPO) close on Friday. The large diagnostics chain operator had opened its IPO on September 1 and stayed open for trading for three days. Over the course of the three days that the issue was open, it received a solid response from investors. Upon closing, the issue was subscribed a total of 4.54 times by the investors for its Rs 1,895.04 crore public issue. The issue received bids for 11.36 crore equity shares against its IPO size of 2.50 crore equity shares.
Out of all the investors, the qualified institutional buyers (QIBs) were the ones who had subscribed to the issue the most as they stood at a subscription of 13.07 times. At the end of the trading day, the non-institutional investors (NIIs) had subscribed to the issue a total of 1.32 times over the course of the IPO. Then there were the Retail investors, from whom the issue had witnessed a subscription of 109 per cent or 1.09 times. It should be noted that there was also an investor category that saw the employees subscribe to the Vijaya Diagnostic IPO. The employee segment had a subscription of 0.98 times.
The company had aimed to garner around Rs 1,895 crore via the public issue. The issue itself was entirely an offer for sale (OFS) of the same amount with an original standing of 35,688,064 equity shares. These shares were then reduced to the aforementioned 2.50 crore equity shares. The company had also managed to mobilise Rs 566 from its anchor investors on August 31, 2021, a day before the IPO opened for trading. It was achieved at the higher end of the price band i.e., Rs 531 per equity share.
Since the issue has come to a close, the next order of business is the allotment and listing among other post-IPO activities. The basis of allotment is set to take place on September 8, 2021. The refunds to the unlucky investors who failed to snag a share will be done on September 9. Those who did manage to buy their targeted shares, however, will see the accreditation happen on September 13, 2021. The listing date for the IPO on the bourses is likely to be on September 14, though this could change.
The grey market premium (GMP) stood at Rs 10 according to information on IPO Watch. This indicated that the IPO’s shares were trading at a premium of Rs 532 to Rs 541 per equity share on the unlisted grey market.
The issue is a book-built issue type with a face value of Rs 1 per equity share. The company carried a market lot of 28 shares at the lower end and 364 shares at the higher end. The object of the issue was to list of the NSE and BSE, as well as sell its share in the OFS. The promoter for the issue was promoted by Dr S Surendranath Reddy and investors (Karakoram, and Kedaara Capital Alternative Investment Fund – Kedaara Capital AIF 1).
Speaking on the Vijaya Diagnostic Centre’s financial performance, Hem Securities said, “Company’s business has demonstrated strong financial performance. For the three months ended June 30, 2021, company’s operating revenue per test was Rs 562.31 and OPBDIT per test was Rs 260.59; company’s operating revenue per customer was Rs 1,298.96 and OPBDIT per customer was Rs 601.39. For the fiscal year 2021, company has grown at CAGR of 13.26 per cent for fiscal years 2019 to fiscal year 2020; its operating revenue per test was Rs 428 and OPBDIT per test was Rs 168 for fiscal year 2020; while its operating revenue per customer was Rs 1,214 and OPBDIT per customer was Rs 475 for fiscal year 2020. Company’s OPBDIT margin ranked second among other major diagnostics.”
“In addition to high OPBDIT margins, company’s negative working capital and high cash flow generation leading to strong net cash position. Company have also enjoyed return on net worth of 23.64 per cent and the return on capital employed (pre cash) of 42.00 per cent during the fiscal year 2021,” added Hem Securities.