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HomeMutual FundRainbow Kids’s Medicare Restricted IPO evaluation: – myMoneySage Weblog

Rainbow Kids’s Medicare Restricted IPO evaluation: – myMoneySage Weblog


Rainbow Kids’s Medicare Restricted included on August 7, 1998, is a number one multi-specialty pediatric and obstetrics and gynecology hospital chain in India. The corporate’s specialties are pediatrics, which incorporates new child and pediatric intensive care, pediatric multi-specialty companies, pediatric quaternary care (together with multi-organ transplants), and obstetrics and gynecology, which incorporates regular and complicated obstetric care, multidisciplinary fetal care, perinatal genetic and fertility care.

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It operates 14 hospitals and three clinics in 6 cities, with a complete mattress capability of 1,500 beds, as of September 30, 2021. At the moment, 5 of their hospitals are accredited by NABH and three of their hospitals are licensed by EDGE. The corporate had the best variety of hospital beds amongst comparable gamers within the maternity and pediatric well being care supply sector, as of March 31, 2021.

Promoters & Shareholding:

Dr. Ramesh Kancharla, Dr. Dinesh Kumar Chirla, and Dr. Adarsh Kancharla are the corporate promoters. 

Pre Difficulty Share Holding 62.19%
Submit Difficulty Share Holding 49.83%

Public Difficulty Particulars:

Supply on the market: Contemporary subject of approx. 5,166,051 fairness shares of Rs. 10 aggregating as much as Rs. 1300.85 Cr and OFS of approx. 24,000,900 fairness shares aggregating as much as Rs. 1300.85 Cr.

Complete IPO Dimension: Rs. 1580.85 Cr.

Value band: Rs. 516 – Rs. 542.

Goal: For early redemption of NCDs issued by the Firm in full and for capital expenditure on new hospitals and medical tools.

Bid qty: minimal of 51 shares (1 lot) for Rs. 14,892 and most of 13 tons.

Supply interval: 27th April 2022 – 29th Jan 2022.

Date of itemizing: 10th Could 2022.

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Execs:

∙ Main multi-specialty pediatric and obstetrics and gynecology hospital chain in India.

∙ Confirmed capacity to draw, practice and retain high-caliber medical professionals.

∙ Complete perinatal care supplier, with synergies between pediatric and obstetrics and gynecology companies.

∙ The corporate has approached community growth with monetary prudence and has been disciplined when making monetary choices for capital investments.

∙ Skilled and skilled administration staff.

Cons:

∙ Revenues are extremely depending on hospitals in Hyderabad and Bengaluru and any disruption in these areas can have an effect on the corporate’s enterprise.

∙ Have interaction medical doctors totally on a consultancy service contract foundation therefore there’s a danger of medical doctors prematurely terminating their agreements.

∙ Faces intense competitors from different healthcare service suppliers.

∙ The objects of the Supply haven’t been appraised by any financial institution or monetary establishment.

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Subscribe or keep away from?

Sectorial outlook – The overall hospital market dimension in India within the monetary 12 months 2020 was anticipated to be roughly Rs. 4270 billion rising at a CAGR of 13% between the monetary years 2016 and 2020. The Indian Healthcare supply market is estimated to develop to Rs. 5 trillion within the monetary 12 months 2022 with the vast majority of progress being contributed by the low base and the pent-up demand from deferred therapies within the monetary 12 months 2021. With renewed impetus from PMJAY and authorities focus shifting onto the healthcare sector, the healthcare supply market is anticipated to develop at 15-17% CAGR and attain Rs. 7.67 trillion within the monetary 12 months 2025. Progress in family incomes and, consequently, disposable incomes, are vital to the general progress in demand for well being care supply companies in India. The share of households falling within the revenue bracket above Rs. 0.2 million is anticipated to extend to 35% within the monetary 12 months 2022 from 23% within the monetary 12 months 2017 and that is anticipated to have a constructive influence on the hospital sector.

The financials (income and internet revenue) are proven within the graph beneath:

Valuation – For the final 3 years common EPS is Rs. 4.89 and the P/E is round 110x on the higher worth band of Rs. 542. The EPS for FY21 is Rs. 4.25 and the P/E is round 127x and if we annualize FY22 earnings then the asking worth is at a P/E of 31x. Apollo Hospitals (P/E 76.6), Fortis Healthcare (P/E 57), Narayana Hrudayalaya (P/E 41.9), Max Healthcare (P/E 148), and Krishna Institute (P/E 34.9) are the listed friends as per the RHP. The corporate P/E is between 31x and 127x.

Suggestion – It’s a main multi-specialty pediatric and obstetrics and gynecology hospital chain in India and has generated sturdy income progress within the final 3 years and 9 months although the fluctuating margins are a little bit of concern. After contemplating all of the components we’d suggest buyers to “Subscribe” to this IPO from a medium to long run perspective.

Disclaimer:

This text shouldn’t be construed as funding advise, please seek the advice of your Funding Adviser earlier than making any sound funding resolution. Should you don’t have one go to mymoneysage.in

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