Yatharth Hospitals IPO subscribed 36.15 times at close

Yatharth Hospitals IPO worth ₹686.55 crore, consisted of a combination of fresh issue and offer for sale. The fresh issue was to the tune of ₹490 crore while the offer for sale (OFS) was worth ₹196.55 crore. The IPO pricing was done in the band of ₹285 to ₹300 with the final price to be discovered through the process of book building. While the QIB portion only picked up traction on the last day, the retail portion and the HNI / NII portion got fully subscribed on the first day of the IPO itself. In fact, even the overall IPO had been fully subscribed on the first day of the IPO itself.

Quick update on Yatharth Hospitals IPO response

Yatharth Hospitals IPO saw fairly steady response on Day-1 and Day-2 of the IPO and closed with rather healthy subscription numbers at the close of Day-3. In fact, the company got fully subscribed on the first day of the IPO itself. As per the combined bid details put out by the BSE at the close of Day-3, Yatharth Hospitals IPO was subscribed 36.15X overall, with best demand coming from the QIB segment, followed by the HNI / NII segment and the retail segment in that order. In fact, the institutional segment saw some very good traction on the last day. The HNI portion did do well and a lot of the surge of funding applications and corporate applications did come in on the last day of the IPO. Retail portion got fully subscribed on Day-1 and built gradually. Here are the details of overall allocation.

As of close of 28th July 2023, out of the 165.18 lakh shares on offer in the IPO, Yatharth Hospitals & Trauma Care Services Ltd saw bids for 5,971.83 lakh shares. This implies an overall subscription of 36.15X overall. The granular break-up of subscriptions was in favour of the QIB investors followed by the HNI / NII investors while the retail portion got the lowest subscription among the various categories. QIB bids and NII bids typically gather most of the momentum on the last day, and that was the case in this issue also in the case of QIB bids. Both the QIB and the NII bids picked momentum on the last day and added to its heft of the previous days. Here are the details of the category-wise subscription.

Yatharth Hospitals IPO Subscription status of QIB Portion

Let us first talk about the pre-IPO anchor placement. On 24th April 2023, Yatharth Hospitals & Trauma Care Services Ltd did an anchor placement 30% of the IPO size getting absorbed by the anchors. Out of the 2,28,85,023 shares on offer, the anchors picked up 68,65,506 shares accounting for 30% of the total IPO size. The anchor placement reporting was made to the BSE late on 25th July 2023. The IPO of Yatharth Hospitals & Trauma Care Services Ltd opened on 26th July 2023 in the price band of ₹285 to ₹300 and closed for subscription on 28th July 2023 (both days inclusive). The entire anchor allocation was made at the upper price band of ₹300. Here are the details of the anchor allocation with the principal subscriber names and quantity absorbed.

Data Source: BSE Filings

The QIB portion (net of anchor allocation as explained above) had a quota of 46.45 lakh shares of which it has got bids for 3,953.18 lakh shares at the close of Day-3, implying a subscription ratio of 85.10X for QIBs at the close of Day-3. QIB bids typically get bunched on the last day and while the heavy demand for the anchor placement had given an indication of the institutional appetite for the Yatharth Hospitals & Trauma Care Services Ltd IPO subscription overall, the actual demand did turn to be quite robust for the IPO.

Subscription status of HNI / NII Portion

The HNI portion got subscribed 37.22X (getting applications for 1,325.69 lakh shares against the quota of 35.62 lakh shares). That is a very strong response at the close of Day-3 largely because this segment normally sees the maximum response bunched on the last day. Bulk of the funded applications and corporate applications, come in on the last day of the IPO, and that was visible as the overall HNI / NII portion added to its heft on the last day of the IPO. Apart from the QIB portion, even HNIs saw good traction on the last day.

Now the NII/HNI portion is reported in two parts viz. bids below ₹10 lakhs (S-HNI) and bids above ₹10 lakhs (B-HNI). The bids above the ₹10 lakh category (B-HNIs) typically represents most of the major funding customers. If you break up the HNI portion, the above ₹10 lakh bid category got subscribed 40.25X while the below ₹10 lakh bid category (S-HNIs) got subscribed 31.17X. This is just for information and is already part of the overall HNI bids explained in the previous para.

Yatharth Hospitals Subscription status of Retail Individuals

The retail portion was subscribed just 8.34X at the close of Day-3, showing steady to strong retail appetite. It must be noted that retail allocation is 35% in this IPO. For retail investors; out of the 83.11 lakh shares on offer, valid bids were received for 692.98 lakh shares, which included bids for 596.08 lakh shares at the cut-off price. The IPO is priced in the band of (₹285 to ₹300) and has closed for subscription as of the close of Friday, 28th July 2023.

Brief on the business model of Yatharth Hospital & Trauma Care Services Ltd

Yatharth Hospital & Trauma Care Services Ltd was incorporated in 2008 as a multi-care hospital chain. It ranks among the top 10 largest private sector hospital in the Delhi / NCR region. It currently operates 3 super specialty hospitals situated at Noida, Greater Noida, and Noida Extension. The major facility at Noida Extension Hospital has a capacity of 450 beds and offers high-end medical and operative care. Yatharth Hospital & Trauma Care Services Ltd also recently acquired a 305-bedded multi-specialty hospital in Madhya Pradesh.

Yatharth Hospital & Trauma Care Services Ltd has a team of 370 plus doctors across various disciplines. Some of the super specialty centres of excellence include Centre of Medicine, Centre of General Surgery, Centre of Gastroenterology, Centre of Cardiology and Centre of Nephrology & Urology. In addition, the Yatharth Hospital & Trauma Care Services Ltd specializes in Pulmonology, Neurosciences, Paediatrics, Gynaecology, Orthopaedics and Rheumatology. Several PE funds have also shown genuine interest in healthcare companies.

The issue is jointly lead managed by IIFL Securities, Ambit Private Ltd and Intensive Fiscal Services Private Ltd. Link Intime India Private Ltd will be the registrars to the issue. The company will use the fresh funds to repay borrowings of the parent and loans of subsidiaries. It will also fund capex of parent & subsidiaries and fund inorganic growth.