Dr Agarwal’s Healthcare’s Rs 3,037-crore IPO opens next Wednesday; sets price band at Rs 382-402

The private equity giants TPG and the Singaporean sovereign wealth fund Temasek will be selling 6.95 crore shares which have a face value of Re 1 each aggregating to Rs 695 crore through the OFS.
CEO of Dr Agarwal’a Eye Hospital Group Dr Adil Agarwal (left) and Chairman Dr Amar Agarwal during a press meet in Chennai
CEO of Dr Agarwal’a Eye Hospital Group Dr Adil Agarwal (left) and Chairman Dr Amar Agarwal during a press meet in ChennaiPhoto | DEBADATTA MALLICK
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MUMBAI: The largest eyecare hospital chain, Dr Agarwal’s Healthcare backed by private equity majors TPG and Temasek, has fixed Rs 382-402 as the price-band for its up to Rs 3,027-crore initial share sale that opens next Wednesday.

The initial public offer (IPO) which opens on January 29, comprises a fresh issue of Rs 300 crore and an offer of sale up to 67,842,284 shares aggregating to Rs 2,727 crore at the upper end of the price band or up to Rs 2,727.26 crore at the lower end.

Those participating in the OFS include promoters, external investors, and other selling shareholders, the Chennai-based company told reporters on Friday.

The private equity giants TPG and the Singaporean sovereign wealth fund Temasek will be selling 6.95 crore shares which have a face value of Re 1 each aggregating to Rs 695 crore through the OFS.

The promoters own 38% stake in Dr Agarwal's Healthcare and TPG holds 33.75% while Temasek holds 28.18% in the issuer.

In May 2022, it had raised Rs 1,050 crore from TPG (Texas Pacific Group) and Temasek, making it the largest fundraise in the country’s eyecare space. The investment had paved the way for an exit of existing investor ADV Partners. The company also raised Rs 270 crore in investment from Temasek in 2019.

Dr Agarwal’s Healthcare is the parent of the Dr Agarwal's Eye Hospital, which is already a listed entity owning 71.90% stake.

Rs 195 of the fresh issuance will be used for debt repayment in part and the balance will be used for general corporate purposes and unidentified inorganic acquisitions, Dr Amar Agarwal, chairperson of the hospital chain started as a single facility in Chennai in 1957, said.

According to a Crisil report cited in its SEBI filing, the company held about 25% of the total eyecare service chain market in FY23 and the largest facility in terms of revenue.

As of September 2024, it operated 193 facilities across 117 cities spanning 18 states along with 16 facilities spread across nine African countries.

On the financial front, its net profit dropped by 8% to Rs 95 crore in FY24 despite healthy topline and operating performance due to higher taxes. Revenue increased 31% to Rs 1,332 crore from Rs 1,018 crore in FY23.

The domestic eye care industry is projected to grow at 12-14% in the next four years. The size of the eye care services industry was around Rs 37,800 crore in fiscal 2024 and is projected to grow to Rs 65,000 crore by FY28.

Dr Agarwal’s group of Eye Hospitals started as a single facility in Chennai in 1957. The group offers a complete gamut of eye care services such as cataract, laser correction, vitreoretinal surgery, corneal transplantation, glaucoma and squint. In addition to this, super-speciality eye care services like pediatric ophthalmology, ocular oncology, neuro-ophthalmology, uvea and oculoplasty are also offered at its tertiary hubs.

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