MedPlus Health IPO: Opens tomorrow; find key details that investors must know before investing

MedPlus Health IPO: MedPlus Health Services Limited, a pharmacy retailer, will launch its initial public offering (IPO) on Monday, December 13, 2021. The three-day initial share sale will close on Wednesday, December 15, 2021.

The company has fixed a price range of Rs 780-796 per equity share. A retail investor can bid for a minimum of 18 equity shares and in multiples thereafter. At the upper end of the price band, one lot is worth Rs 14,328.

The company has reserved equity shares worth Rs 5 crore for its eligible employees, who will be provided with a discount of Rs 78 per equity share for the eligible employees.

Hyderabad-based MedPlus Health Services, which is the second-largest pharmacy retailer in India, has plans to raise up to Rs 1,398.29 crore via the primary route. The pubic issue of the pharmacy retailer consists of the issuance of fresh equity shares worth Rs 600 crore while and an offer for sale (OFS) of equity shares aggregating up to Rs 798.29 crore (including Anchor portion of 52,51,111 Equity Shares) by the promoter and existing shareholders. The company reduced the OFS size to Rs 798.30 crore from Rs 1,038.71 crore.

Proceeds of the fresh issue will be used for funding the working capital requirements of the company's subsidiary, Optival.

Issue Timeline

• Bidding Period for the IPO: December 13-15, 2021.
• Allotment: December 20, 2021.
• Initiation of Refunds: December 21, 2021.
• Credit of Shares to Demat Account: December 22 2021.
• IPO Listing: December 23, 2021.

Fifty per cent of the net issue is reserved for qualified institutional buyers (QIBs), whereas non-institutional buyers will have 15 per cent of shares allocated for them. The retail portion has been fixed at 35 per cent of the offer.

Axis Capital Limited, Credit Suisse Securities (India) Private Limited, Edelweiss Financial Services Limited and Nomura Financial Advisory and Securities (India) Private Limited are the Book Running Lead Managers of the issue while KFin Technologies Private Limited is the registrar for it.

Besides, the Pharmacy retailer had mopped up Rs 418 crore from the anchor investors on Friday, ahead of its initial public offer opening for a subscription. The company has allotted 52.51 lakh equity shares to anchor investors at Rs 796 per share aggregating to Rs 417.98 crore, according to a circular uploaded on the BSE website.

Abu Dhabi Investment Authority, BlackRock Global Funds, Fidelity, Nomura, Goldman Funds, Fidelity, Nomura, Goldman Sachs, Morgan Stanley, HFFC Life Insurance Company, ICICI Prudential Life Insurance Company and SBI Life Insurance Co Ltd, SBI Mutual Fund (MF) and Aditya Birla Sun Life MF are among the anchor investors.

MedPlus Health is the second-largest pharmacy retailer in India, in terms of revenue from operations for the financial year 2021, and a number of stores as of March 31, 2021, according to the Technopak Report.

It offers a wide range of products, including pharmaceutical and wellness products, including medicines, vitamins, medical devices and test kits, and fast-moving consumer goods, such as home and personal care products, including toiletries, baby care products, soaps and detergents, and sanitisers. The company was founded in 2006 by Gangadi Madhukar Reddy, the Managing Director and Chief Executive Officer, with the vision to set up a trusted pharmacy retail brand that offers genuine medicines and delivers better value to the customer by reducing inefficiencies in the supply chain using technology. The company's operations are primarily distributed between the Issuer and Subsidiaries.

Medplus was also the first pharmacy retailer in India to offer an omnichannel platform and continues to scale up its retail store network. It has maintained a strong focus on scaling up our store network, having grown from operating our initial 48 stores in Hyderabad at the conception of our business to operating India's second-largest pharmacy retail network of over 2,000 stores distributed across Tamil Nadu, Andhra Pradesh, Telangana, Karnataka, Odisha, West Bengal and Maharashtra, as of March 31, 2021, according to the Technopak Report.

Gangadi Madhukar Reddy, Agilemed Investments Pvt Ltd; and Lone Furrow Investments Pvt Ltd are the promoters of the company. Currently, the promoters cumulatively hold 48,233,135 Equity Shares, aggregating 43.16 per cent of the pre-Offer Equity Share capital on a fully diluted basis.

MedPlus reported a profit of Rs 63.11 crore for FY21, up from just Rs 1.79 crore in FY20. Revenue during the same period increased to Rs 3,069.26 crore from Rs 2,870.6 crore.

The equity shares are proposed to be listed on BSE and NSE.