Suraksha Diagnostic IPO Stock Performance Analysis 10 Days Post-Listing

This report is focused on the performance of Suraksha Diagnostic Limited’s IPO in the ten days following its listing on 6th December 2024. Through a detailed analysis of stock price trends, trading volumes, and broader market dynamics, we aim to uncover the key factors influencing the stock's performance.

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Suraksha Diagnostic IPO Stock Performance Overview

The performance of Suraksha Diagnostic Limited, after its listing, has been shaped by several factors, including market conditions, investor sentiment, and related news. It marked a muted debut, listing at a discount of 0.9% on the BSE and 0.7% on the NSE from its issue price. Over the past 10 days, the stock has recorded a high of approximately ₹449.00 and a low of ₹402.10 on NSE.  

Key Factors Impacting Suraksha Diagnostic Performance include

The stock’s performance has been influenced by a combination of sectoral trends and company-specific factors, including:

• Market Conditions and Investor Sentiment: Broader market dynamics and overall investor sentiment may have played a role in influencing the stock’s subdued performance.
• IPO Subscription Response: The Suraksha Diagnostic IPO witnessed lukewarm demand, with overall subscription reaching 1.27 times, including retail at 0.94 times, QIBs at 1.74 times, and NIIs at 1.4 times.
• Offer for Sale (OFS) Nature: As a complete Offer for Sale, the company did not receive any funds from the IPO, limiting its ability to leverage proceeds for growth or expansion.
• Financial Performance: While the company showed revenue and profit recovery in FY24 and Q1 FY25, inconsistent profit margins and past revenue declines raise concerns about operational efficiency and long-term growth sustainability.

Suraksha Diagnostic Stock Analysis

• Listing Date: 6 December, 2024
• Initial Price: ₹437 on BSE and ₹438 on NSE (down by approximately 0.9% and 0.7% on BSE and NSE, respectively from its issue price of ₹441)
• Current Price: ₹413.40 (down by around 5.6% over the listing price)

Market Reaction: Suraksha Diagnostic's market debut witnessed a muted listing. As the Suraksha Diagnostic IPO is a complete Offer for Sale (OFS), the company will not receive any proceeds from the issue. By the end of Day 3, December 3, 2024, at 6:19 PM, the IPO was subscribed 1.27 times overall, with the retail category at 0.94 times, the Qualified Institutional Buyers (QIB) segment at 1.74 times, and the Non-Institutional Investors (NII) category at 1.4 times.

Financial Performance: 

Suraksha Diagnostic experienced a decline in revenue from ₹223.1 crore in FY22 to ₹190.1 crore in FY23, before rebounding to ₹218.7 crore in FY24 and ₹60.7 crore in Q1 FY25. EBITDA also dropped from ₹45.3 crore in FY22 to ₹32.6 crore in FY23 but recovered to ₹46.2 crore in FY24 and ₹12.3 crore in Q1 FY25. Net profit saw a sharp fall from ₹20.8 crore in FY22 to ₹6.0 crore in FY23, rising significantly to ₹23.1 crore in FY24 and ₹7.6 crore in Q1 FY25. Despite the recovery in revenue and profitability, inconsistent profit margins underscore operational inefficiencies could challenge long-term sustainability.

Conclusion

In the ten days post-listing, Suraksha Diagnostic Limited's stock performance has been influenced by a muted debut, lackluster IPO demand, and concerns surrounding operational efficiency despite recent financial recovery. As the company begins its journey on the market, the stock’s future trajectory will depend on the company’s ability to address these challenges and sustain consistent growth.