Upcoming IPO: Dr Agarwal’s Healthcare, backed by Temasek Holdings and TPG, is preparing for an initial public offering (IPO) as the company filed papers with the Securities and Exchange Board of India (SEBI) on September 27.
The IPO includes a fresh issue of equity shares worth ₹300 crore, along with an offer-for-sale (OFS) of 6.95 crore shares by the promoters and investors. Prominent shareholders selling in the OFS include Amar Agarwal, Athiya Agarwal, and other family members, as well as institutional investors Arvon Investments, Claymore Investments (both owned by Temasek), and Hyperion Investments (backed by TPG), as per the DRHP.
Currently, the promoters hold a 37.83 per cent stake in the company, while the rest is owned by public shareholders. This includes Arvon with a 12.45 per cent share, Claymore with 15.73 per cent, and Hyperion with 33.75 per cent.
Dr Agarwal's Healthcare has 165 centres in India and 15 across the globe. The company offers eye care services such as cataract surgeries and optical products. It holds about a 25 per cent share of India’s eye care market as of fiscal 2024.
The Indian eye care industry is expected to grow at a compound annual growth rate (CAGR) of 12-14 per cent, increasing from ₹37,800 crore in FY24 to around ₹55,000- ₹65,000 crore by FY28.
Dr Agarwal plans to use ₹195 crore from the fresh issue to reduce debt and the rest for corporate purposes and acquisitions. As of July 2024, its debt stood at ₹384 crore. The company’s debt-to-equity ratio has improved over the last fiscal, dropping to 0.70x in FY24 from 1.3x in FY23.
Financially, despite reporting a 30.9 per cent rise in revenue to ₹1,332 crore in FY24, its net profit dipped 7.9 per cent to ₹95 crore due to higher tax expenses. EBITDA rose 34 per cent to ₹362.3 crore, with margins improving slightly to 27.2 per cent.
Kotak Mahindra Capital, Morgan Stanley India, Jefferies India, and Motilal Oswal Investment Advisors are managing the IPO.
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