Dodla Dairy and Krishna Institute of Medical Sciences (KIMS Hospitals), which had recently concluded their initial public offerings, made debut on the stock exchanges on Monday.
Dodla Dairy listed at 28.5% premium over issue price. The stock opened at Rs 528 on BSE against issue price of Rs 428 while it listed at Rs 550 on the NSE. Started in 1995, Dodla Dairy has a significant presence in the southern region of India, with operations primarily across the five Indian states of Andhra Pradesh, Telangana, Karnataka, Tamil Nadu and Maharashtra. The company is third highest in terms of milk procurement with average procurement of 1.03 million litre of raw milk per day among private dairy players with a significant presence in southern India.
Dodla Dairy garnered Rs 520 crore from its public issue, including Rs 156 crore from anchor investors. Its initial share-sale was subscribed 45.62 times at a price band of Rs 421-428 apiece. The IPO was opened for public subscription on June 16 and concluded on June 18. The category reserved for qualified institutional buyers (QIBs), was subscribed 84.88 times, non-institutional investors 73.62 times and portion set aside for retail investors was subscribed 11.34 times. The IPO comprised fresh issuance of shares worth up to Rs 50 crore, besides, an offer for sale of up to 1,09,85,444 equity shares by TPG Dodla Dairy Holdings Pte Ltd, Dodla Sunil Reddy, Dodla Deepa Reddy and Dodla Family Trust.
“Going forward, the organised segment is expected to grow at a faster pace of 12-
13%, while the unorganised segment is expected to grow at 8-10%, thus
enhancing the share of organised players in the near future," said ICICI Securities in a report.
“The company intends to continue to grow domestically and internationally by way of organic and inorganic growth in order to increase its presence. In India, the company has grown in the past organically by setting up its own processing plants and inorganically by either acquiring processing plants or business units," it added.
KIMS shares opened with a 22.29 per cent premium to IPO price of Rs 825. The stock got listed at Rs 1,008.90 against issue price of Rs 825 on the BSE. On NSE, the stock price started off at Rs 1,009, up 22.30 per cent from issue price. Krishna Institute of Medical Sciences Ltd (KIMS) is one of the largest corporate healthcare groups in Andhar Pradesh and Telangana in terms of number of patients treated and treatments offered. It has significantly expanded its hospital network in recent years through its acquisitions of hospitals in Ongole, Vizag and Anantapur and Kurnool in Andhra Pradesh in fiscal year 2020.
KIMS successfully raised Rs 2,144 crore through its IPO, which included a little over Rs 955 crore that was mobilised from anchor investors. KIMS IPO which opended for subscription during June 16-18, was subscribed 3.86 times at a price band of Rs 815-825 per share. The portion meant for qualified institutional buyers (QIBs) was subscribed 5.26 times, retail individual investors (RIIs) 2.9 times and non-institutional investors 1.89 times.
“CRISIL Research estimates the Indian healthcare delivery market at Rs. 4.3 trillion in value terms and 1.7 billion treatments in volume terms (inclusive of both in-patient and out-patient) in fiscal 2021, with the growth being contributed by the increased government expenditure onto the sector to combat Covid-19 as private hospitals are expected to witness a decline in revenues," said HDFC Securities in a report. “With renewed impetus from the PMJAY, the healthcare delivery market is expected to log a CAGR of 17-18% and reach Rs. 7.07 trillion in fiscal 2024," it added.
“Going forward, we expect better operational performance with the break-even stage of four newly acquired hospitals having lesser payback period and are ready to serve customers from day zero. We believe KIMS is relatively valued cheaply at 17.1x FY21 EV/EBITDA in comparison to its peers," said Prabhudas Lilladher.