Medi Assist Healthcare IPO: Should I subscribe or stay away? Verify the pricing band and GMP.
The first public offering (IPO) of Medi Assist Healthcare, which comprises an offer for sale (OFS) of 2.8 crore shares, is currently accepting subscriptions and will remain open through January 17. The business has already received Rs 351 crore from anchor investors, which include reputable firms like Nomura, Goldman Sachs, Pinebridge Global, Troo Capital, and HSBC.
Notably, the Rs 1,171 crore IPO is totally an offer-for-sale (OFS), meaning that the business will not profit from the IPO’s proceeds; instead, the proceeds would be paid to the selling shareholders.
Through its wholly-owned subsidiaries, Medi Assist Healthcare specialized in providing insurance companies with third-party administration services. Third-party administrators are in charge of customer service, network management, policy administration, and processing health insurance claims.
Should You Subscribe or avoid?
Experts advise investors to think about purchasing into the initial public offering (IPO), citing the company’s strong position in the market as a third-party administrator that might benefit from the expansion of the health insurance industry. Nevertheless, considerable caution is advised due to the known risks and the relatively higher price.
According to Choice Broking, Medi Assist Healthcare Services services the constantly developing health insurance sector. In view of its leading market dominance in TPA, consistent financial performance, strong cash flow production, and dividend distribution, we rate the issue “SUBSCRIBE.”.
The Medi Assist Healthcare IPO would be priced between Rs 397 and Rs 418 per share. Bids can be placed in lots of 35 shares, with retail investors receiving 35% of the offer, non-institutional investors receiving 15%, and qualified institutional buyers (QIBs) receiving 50% of the offer.
For the six months that ended in September 2023, the company reported a 26% YoY increase in total revenue to Rs 312 crore but a 39% decline in net profit to Rs 22.5 crore.
In the unlisted market, Medi Assist Healthcare’s Grey Market Premium (GMP) is now quoted to be Rs 30. Axis Capital, IIFL Securities, Nuvama Wealth Management, and SBI Capital Markets are the bookrunning lead managers for the initial public offering.
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Medi Assist Healthcare IPO key details
Size of IPO: Medi Assist Healthcare is making an Offer for Sale (OFS) of 2.8 crore shares, with no additional issuance, in order to collect Rs 351 crore from anchor investors.
Price Range: Between Rs 397 and Rs 418 per share, buyers have the opportunity to bid for 35 shares in a single lot during the IPO.
Investor Reservation: Retail investors and non-institutional investors have 15% and 35% of the reservation, respectively, while qualified institutional buyers (QIBs) have 50% of the reserve.
Financial Snapshot: For the six months ended September 2023, the firm recorded a 26% YoY gain in total income to Rs 312 crore, with a net profit reduction of 39 percent to Rs 22.5 crore.
Grey Market Premium (GMP): Indicating investor opinion, the current GMP for Medi Assist Healthcare in the unlisted market is Rs 30.