Unlisted shares of GPT Healthcare Ltd are trading Rs 19 higher in the grey market, expecting a 10.22 per cent listing gain from the public issue
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GPT Healthcare IPO Day 2: The initial public offering of GPT Healthcare Ltd, which was opened for public subscription on February 22, could not be fully subscribed on the first day. Till 11:23 am on the second day of bidding on Friday, February 23, the Rs 525.14-crore IPO received 0.54 times subscription, garnering bids for 1,07,02,000 shares as against 1,97,63,327 shares on offer.
The IPO will be closed on Monday, February 26, 2024. The price band of the IPO has been fixed at Rs 177-186 per share.
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The retail category has received 0.92 times subscription and the non-institutional quota got 0.38 times subscription.
The allotment of the GPT Healthcare IPO will take place on February 27, while its listing will take place on both NSE and BSE on February 29, 2024.
GPT Healthcare, which operates and manages mid-sized multi-specialty hospitals under the ILS Hospitals brand, on Wednesday collected Rs 157.54 crore from anchor investors a day before the IPO.
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GPT Healthcare IPO GMP Today
According to market observers, unlisted shares of GPT Healthcare Ltd are trading Rs 19 higher in the grey market as compared with its issue price. The Rs 19 grey market premium or GMP means the grey market is expecting a 10.22 per cent listing gain from the public issue. The GMP is based on market sentiments and keeps changing.
‘Grey market premium’ indicates investors’ readiness to pay more than the issue price.
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GPT Healthcare IPO: Should You Subscribe?
Assigning the ‘subscribe long-term’ rating, brokerage Anand Rathi in a note said, “At the upper price band, the company is valuing at P/E of 39.1 times with a market cap of Rs 1,526.2 crore post issue of equity shares and return on net worth of 23.7 per cent in FY23. On the valuation front, we believe that the company is fairly priced. Thus, we recommend an ‘subscribe for long term’ rating to the IPO.”
Another brokerage StoxBox, however, has given the ‘Avoid’ rating to the IPO. It said the company is yet to expand its operations successfully to other parts of India. The bed occupancy rates need to improve to reflect better financial performance. “We recommend an ‘avoid’ rating for the issue. However, we would reassess the company on improvement in financial metrics over a sustained period.”
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Giving a ‘subscribe’ rating, Mehta Equities in its note said, “Investors should also look at IPO offer, which come with a 100 per cent OFS issue, which is an area of concern for new investors. Hence, considering all parameters we recommend only high risk investors can ‘subscribe’ to the IPO for the long term while conservative investors can wait and watch the stock post listing.”
GPT Healthcare IPO Details
The IPO is a combination of a fresh issue of equity shares aggregating to Rs 40 crore and an Offer For Sale (OFS) of up to 2.6 crore equity shares by private equity firm BanyanTree Growth Capital II.
BanyanTree, which holds 2.6 crore shares or 32.64 per cent stake in Kolkata-based GPT Healthcare, is divesting its entire shareholding in the company.
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Proceeds from the fresh issue to the tune of Rs 30 crore will be used for payment of debt and general corporate purposes.
The IPO will mobilise Rs 501.67 crore at the lower end of the price band and Rs 525.14 crore at the upper end.
GPT Healthcare, founded by Dwarika Prasad Tantia, Dr Om Tantia and Shree Gopal Tantia, started with an eight-bed hospital in Kolkata in 2000. Today it operates four full service multi-specialty hospitals, with a total capacity of 561 beds.
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The company competes with listed industry peers, including Global Health Ltd, Krishna Institute of Medical Sciences Ltd, Jupiter Life Line Hospitals Ltd, Yatharth Hospital & Trauma Care Services Ltd and Shalby Ltd.
Half of the issue has been reserved for qualified institutional buyers, 35 per cent for non-institutional investors and the remaining 15 per cent for retail investors. Investors can bid for a minimum of 80 equity shares and in multiples of 80 equity shares thereafter.
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Its total income increased 7.3 per cent to Rs 361.03 crore in FY23 from Rs 337.41 crore in FY22.
JM Financial is the sole book-running lead manager to the issue. The equity shares are proposed to be listed on the BSE and the NSE.
