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Review By Dilip Davda on December 27, 2011
The calendar year 2011 that began with the IPO of C Mahindra Exports Ltd. Virtually gone on vacation since October 2011 and turned poor one for primary market and postponement of many PSU divestment offers.
However, as usual, there has been a surprising announcement of IPO opening on 30.12.2011 to mark the end of calendar year 2011 to have a total 41 IPOs for the calendar year. This time the IPO is from healthcare sector. Details of the said IPO are as under:
Delhi based Ojjus group which has a venture called Goodwill Hospital and Research Centre is entering capital market with a public issue to raise Rs.62 crore along with one detachable warrant per equity share. The issue opens on 30.12.2011 and closes on 09.01.2012. The funds so mobilized will be used to part finance investment in its subsidiary that is setting up 700 bed hospital in northern India and also for for setting up of diagnostic centre at Faridabad, establishment of six polyclinics involving a cost of and repayment/prepayment of loans.
The company is offering around 3542850 shares of Rs. 10 each within a price band of Rs. 175-185. The issue is lead managed by SPA Merchant Bankers Ltd. And Beetal Financial & Computer Services Pvt. Ltd. is the registrar to the issue. CARE has assigned IPO grade 3 to this offer indicating at average fundamentals of the company. The listing will be done on BSE and NSE. Detachable warrants can be converted into equity at a discount of 20% of the then prevailing market price in the thirteenth month. Due to intervening holidays, the issue is kept open till 09.01.2012.
As far as Lead Merchant Banker's (SPA Merchant Bankers) mandate performance is concerned, it has 5 IPOs to its credit in the past out of which only 2 IPOs gave marginal listing gains and rest have posted poor listings.
The company is engaged in running a multi specialty hospital at Noida called Ojjus Medicare, focusing on core areas such as neurology and neuro surgery, cardiology and cardiac surgery with emphasis on joint replacements and sports injuries. It also provides other services like paediatrics, diagnostic, critical care medicine, oncology, dermatology etc
With major contribution coming in from its first in Asia - Gama Knife Machine, the company clocked in a total turnover of Rs. 53.58 crore with a net profit of Rs. 15.30 crore giving an EPS of Rs. 17 per share for the year 2010-11. For first three months of the current fiscal it has earned net profit of Rs. 5.34 crore on a turnover of Rs. 16.08 crore. On annualized basis this gives and EPS of Rs. 23.72 on old capital base and Rs. 17.00 on expanded equity post this issue. Thus the offer price is at around 10 plus P/E. Based on its NAV of Rs. 41 as on 30.06.2011, the issue is being made at around 4.3 P/BV. With this offer, existing promoter's stake will get diluted to around 73%.
The company has seen over 100 per cent growth for last fiscal and hopes to maintain the same in coming years as well with enhanced contribution from Gama Knife which is currently around 15% of its full capacity. The top and bottom line will get boost from the new 700 bed healthcare centre once it turns fully operation by 2014-15.
Considering ongoing prices of peers that are moving in the range of 12 - 19 P/E, this offer appears averagely priced. However, considering current market scenario, only risks aver investors can park their fund for listing gains, if any.
Modest investment for listing gains.
Review By Dilip Davda on December 27, 2011
DISCLAIMER: No financial information whatsoever published anywhere here should be construed as an offer to buy or sell securities, or as advice to do so in any way whatsoever. All matter published here is purely for educational and information purposes only and under no circumstances should be used for making investment decisions. Readers must consult a qualified financial advisor before making any actual investment decisions, based on the information published here. My reviews do not cover GMP market and operators game plans. Any reader taking decisions based on any information published here does so entirely at their own risk. Investors should bear in mind that any investment in stock markets is subject to unpredictable market-related risks. The above information is based on RHP and other documents available as of date coupled with market perception. The author has no plans to invest in this offer.
About Dilip Davda
Dilip Davda is veteran journalist associated with stock market since 1978. He is contributing to print and electronic media on stock markets/insurance/finance since 1985.
Dilip Davda is a leading reviewer of public issues and NCDs in the primary stock market in India. The knowledge he gained over 3 decades while working in the stock market and a strong relationship with popular lead managers makes his reviews unique. His detail fundamental and financial analysis of companies coming up with IPO helps investors in the primary stock market. Dilip Davda has a special interest in analyzing the SME companies and writing reviews about their public issues. His reviews are regularly published online and in news papers.
(Dilip Davda -SEBI registered Research Analyst-Mumbai,
Registration no. INH000003127 (Perpetual)
Email id: dilip_davda@rediffmail.com ).
The initial public offer (IPO) of Goodwill Hospital & Research Centre Ltd offers an early investment opportunity in Goodwill Hospital & Research Centre Ltd. A stock market investor can buy Goodwill Hospital IPO shares by applying in IPO before Goodwill Hospital & Research Centre Ltd shares get listed at the stock exchanges. An investor could invest in Goodwill Hospital IPO for short term listing gain or a long term.
Read the Goodwill Hospital IPO recommendations by the leading analyst and leading stock brokers.
Goodwill Hospital IPO offers an opportunity to buy IPO shares before they get listed at the stock exchanges. Read the Goodwill Hospital IPO Notes, Analysis and Recommendations by leading stock brokerage firms and experts in the above answer.
Our recommendation for Goodwill Hospital IPO is to subscribe.
As per the analysis by our lead analyst Mr. Dilip Davda, we suggest you to subscribe to the Goodwill Hospital IPO.
The Goodwill Hospital IPO allotment status will be available on or around [.]. The allotted shares will be credited in demat account by [.]. Visit Goodwill Hospital IPO allotment status to check.
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