Krsnaa Diagnostics has filed draft documents with the Securities and Exchange Board of India (Sebi), a market regulator, for an Initial Public Offering (IPO). The public offering includes a new issue of shares valued at Rs 400 crore and an offer to sell (OFS) of 94 lakh equity shares with a par value of Rs 5 per share by existing shareholders and promoters . The main stakeholders participating in the OFS are the Phi Capital Growth Fund-I of Phi Capital Trust (16 lakh shares), Kitara PIIN 1104 (33.40 lakh shares), Somerset Indus Healthcare Fund (44.54 lakh shares) lakh) and Lotus Management Solutions (21,380 shares). The main book managers at the IPO are JM Financial, DAM Capital Advisors, Equirus Capital Private Ltd and IIFL Securities, while the registrar of the issue is KFin Technologies Private Ltd.
Key details of Krsnaa Diagnostics IPO
– Industry peers listed in Krsnaa Diagnostics are Metropolis Healthcare and Dr. Lal Pathlabs Ltd. The industry average P / E ratio is 97.18x.
– Krsnaa Diagnostics planned to use the net proceeds to finance the cost of establishing diagnostic centers in Punjab, Karnataka, Himachal Pradesh and Maharashtra worth Rs 150.8 crore. 125.7 crore will be used for the repayment and / or prepayment in whole or in part of certain loans used by the company and for general business purposes.
– For the nine months ended December 31, 2020, Krsnaa Diagnostics reported a profit of Rs 195 crore, while operating income stood at Rs 300 crore.
– According to DRHP, Krsnaa Diagnostics, in consultation with its bookkeepers, could consider a pre-IPO placement of Rs 200 crore with key investors.
– The company has seen high demand for PCR testing due to the COVID-19 pandemic, which has positively impacted its overall testing volume, duration and level of demand and reimbursement for COVID-19 molecular testing was uncertain.
– Krsnaa Diagnostics may also be negatively impacted on fundraising and supply chain disruptions, including shortages, delays and price increases of test equipment and supplies, due to the impact of the COVID-19 pandemic.
– The diagnostic company operated more than 1,800 diagnostic centers in 13 states as of December 31, 2020. It also operates a teleradiology reporting center in Pune. Each of its diagnostic centers and in particular the teleradiology reporting center is essential to its operations.
– Krsnaa Diagnostics’ competitors include diagnostic healthcare service providers in India, hospital diagnostic centers, independent clinical laboratories, other smaller scale diagnostic service providers (with more local and regional presence established in certain geographic areas) such as pathology, radiology laboratories and prevention healthcare providers as well as international service providers who may establish and expand their business in the future.
– The company depends on suppliers and third-party suppliers for its imaging equipment, test equipment and reagents and enters into contractual agreements with them.