Mumbai: Aster DM Healthcare Ltd, which runs hospitals in India and West Asia, on Monday said it will launch its Rs980 crore initial public offering on 12 February.
Aster DM has set a price band of Rs180-190 per share for the IPO. The offer will close on 15 February. The initial share sale comprises a fresh issue of shares of Rs725 crore and an offer for sale of 13.42 million shares by Aster DM’s promoter Union Investments Pvt. Ltd. At the upper end of the price band, the share sale will fetch promoters about Rs255 crore.
The proceeds from the fresh issue will be utilized to repay debt, purchase medical equipment and meet general corporate expenses.
Founded by Dr. Azad Moopen in 1987 as a single clinic, Aster DM’s portfolio of healthcare facilities, as of 30 September, consists of nine hospitals, 90 clinics and 206 retail pharmacies in the Gulf Cooperation Council (GCC) states; 10 multi-specialty hospitals and seven clinics in India; and one clinic in the Philippines.
Aster’s hospitals in India are located in Kochi, Kolhapur, Kozhikode, Kottakkal, Bengaluru and Hyderabad and are operated under the Aster Medcity, Malabar Institute of Medical Sciences (MIMS) and Aster Prime Hospital brands. Its clinics in India are located in Kozhikode and Bengaluru.
In fiscal 2017, the company reported a revenue of Rs5,931.29 crore, an increase of 13% from the previous fiscal. It reported a profit of Rs266.47 crore in 2016-17.
Aster DM’s operations in India, which primarily consist of hospitals, accounted for only 18.58% of the company’s total revenues in the six months ended 30 September 2017.
“With the opportunities provided by the Union Budget 2018, we are very bullish on India. We are planning to make investments in both greenfield and brownfield projects in India," chairman and managing director Moopen said.
None of the private equity investors of the hospital chain —Olympus Capital and True North Managers—are selling their stakes in the IPO.
Olympus Capital made an investment in Aster DM in 2011, while True North invested in 2008.
Since December 2016, six healthcare services firms have tapped the primary markets to fund expansion and provide an exit to private equity investors. Collectively, these firms—Eris Lifesciences Ltd, Dr Lal Pathlabs Ltd, Narayana Hrudayalaya Ltd, HealthCare Global Enterprises Ltd, Thyrocare Technologies Ltd and Shalby Ltd—have raised Rs4,620 crore.
In 2017, the Indian primary market witnessed 36 IPOs with companies raising a record Rs67,147 crore, according to data from primary market tracker Prime Database.