Gujarat Kidney IPO Day 2 Highlights: Issue booked 2.62x; GMP falls sharply to 3.5% — Should you apply?

Gujarat Kidney IPO booked 2.67 times so far amid strong interest from retail and NIIs. Here's how different quotas were booked:

QIB: 34%

NII: 2.95x

Retail: 10.45x

Patients primarily pay for the company’s inpatient and outpatient services through a mix of out-of-pocket payments and credit arrangements, including third-party payers such as private and public insurers, said Gujarat Kidney & SuperSpecialty.

The company is not heavily reliant on government programs, such as Ayushman Bharat, which provide coverage for eligible patients under government schemes.

As of June 30, 2025, the company’s hospitals are equipped with multiple key specialties, including internal medicine, general surgery, minimally invasive procedures, orthopaedics and trauma treatment, joint replacement surgery, obstetrics and gynaecology, respiratory failure, non-interventional cardiology, diabetology, and anaesthesiology.

Maximising operating efficiency and profitability is a key part of the company’s growth strategy, with a strong focus on integrating acquisitions and managing organic expansion efficiently.

The company plans to enhance efficiency through greater integration across its hospital network by standardising medical consumables, optimising procurement, consolidating suppliers, and implementing uniform clinical guidelines to benefit from economies of scale.

It continues to invest in advanced medical technology and equipment, including plans to acquire a Stryker orthopaedic robot, while strengthening expertise in high-growth tertiary care areas to improve case mix and increase revenue per occupied bed.

The company is also exploring tie-ups with nearby small nursing homes by providing doctors, staff, and diagnostic and operative services.

Additionally, it aims to centralise procurement across all hospitals to reduce costs, eliminate redundancies, and source equipment and medicines at competitive rates, enabling it to offer affordable healthcare services to patients.

The company is led by its Promoter and Managing Director, Dr. Pragnesh Yashwantsingh Bharpoda, who has over a decade of experience in the medical industry. He has played a key role in expanding the company’s geographical presence by strategically acquiring various multi-speciality hospitals over the years and is an established name in the field of urology.

Dr. Bharpoda has more than a decade of experience as a medical practitioner and established the company’s first hospital, “Gujarat Kidney Hospital,” in Vadodara in 2014, with a vision of providing quality healthcare services in central Gujarat.

Gujarat Kidney IPO booked 2.39 times so far. Here's how different quotas were booked:

QIB: 34%

NII: 2.59x

Retail: 9.27x

Considering the Annualised EPS – June 2025 EPS of ₹2.74 on a post-issue basis, the company is set to list at a P/E of ~41x with a market cap of ₹899 Cr, whereas its peers, namely Yatharth Hospital & Trauma Care Ltd, GPT Healthcare Limited, and KMC Speciality Hospitals (India) Ltd, are trading at a P/E ratio of approximately ~43x, ~27x, and ~40x respectively.

We assign a “Subscribe (With Caution)” rating to this IPO as the company has an asset-light business model focused in the central region of Gujarat and is expanding. However, the company has a limited operating history and needs to continue achieving high growth in the future to justify the valuation, which keeps us cautious from a long-term perspective.

In Gujarat Kidney IPO, 10% or ₹25 crore of the offer is reserved for retail investors. Meanwhile, 15% or ₹38 crore of the offer is allocated to NIIs. And 75% or ₹188 crore of the IPO is earmarked for QIBs.

At the upper end of the price band at Rs. 114, the company is valued at a P/E multiple of 61.6x FY25 earnings. We, thus, recommend a "SUBSCRIBE" rating for this issue, said Stoxbox.

The company follows an asset-light hospital expansion strategy, primarily operating through leased facilities and acquiring controlling stakes in existing hospitals, which allows it to scale operations without significant capital investment in land, buildings, or core infrastructure.

By acquiring majority or controlling interests in hospitals across Bharuch, Borsad, Vadodara, and Anand, the company has rapidly expanded its footprint while maintaining capital efficiency and improving return ratios.

GKASSL is a mid-sized multispeciality hospital chain operating across the central region of Gujarat. It has a portfolio of 7 multispeciality hospitals and 4 pharmacies within the hospital premises. It offers both surgical services (secondary care) and super-speciality surgical services (tertiary care). Additionally, it is planning to acquire “Parekhs Hospital,” based in Ahmedabad, which has a capacity of 49 beds.

During FY25, the company delivered Revenue/EBITDA/PAT of ₹40.2 cr / ₹16.5 cr / ₹9.4 cr, up 742.9% / 748.2% / 449.2% YoY respectively. We believe the company is fairly valued and hence assign a Neutral rating to the issue.

As per Dun & Bradstreet estimates, India’s hospital sector is estimated to generate an annual turnover of nearly ₹6,496 bn in FY24 and is projected to reach nearly ₹8,200 bn by FY26E, with an underlying CAGR of 12.4%. The industry is well-placed to witness substantial growth in the coming years.

Gujarat Superspeciality Hospital provides medical care in areas such as internal medicine, general surgery, minimally invasive procedures, orthopaedics and trauma treatment, joint replacement surgery, obstetrics and gynaecology, respiratory failure, non-interventional cardiology, diabetology, and anaesthesiology.

The company operates seven multispeciality hospitals and four pharmacies with a total bed capacity of 490 beds, an approved capacity of 455 beds, and an operational capacity of 340 beds.

Services:

• Secondary Care Services: General and surgical treatments.
• Tertiary Care Services: Super speciality surgical procedures.

• The company has acquired several hospitals from promoters and may continue such related-party acquisitions.
• Acquisitions and integrations involve operational, financial, and regulatory risks.
• Rapid expansion across multiple hospitals increases management and operational complexity.
• Dependence on promoter-led expertise poses concentration and continuity risks.
• Hospitals lacking certain departments may limit service breadth.

The company operates a multispecialty hospital and related services chain in central Gujarat.

Valuation appears stretched at ~61x P/E, significantly higher than most listed hospital peers.

Smaller scale increases risk, as execution delays or integration issues can materially impact earnings.

This IPO may not be suitable for most investors at the current stage. At the current price band, the IPO appears aggressively valued, leaving limited room for upside in the near to medium term. Investors with a conservative or medium-term investment approach are advised to wait for clearer post-listing price discovery.

— Swastika Investmart

Gujarat Kidney & Super Speciality Limited proposes utilising the proceeds from the Offer towards the following objects:

1. Proposed Acquisition of Parekhs Hospital at Ahmedabad – INR 77 Cr

Funds will be used for the acquisition of Parekhs Hospital in Ahmedabad to expand the Company’s healthcare footprint.

2. Part-Payment for Ashwini Medical Centre – INR 12.4 Cr

A portion of proceeds will be allocated for the part-payment of Ashwini Medical Centre's purchase consideration.

3. Acquisition of Additional Stake in Harmony Medicare – INR 10.78 Cr

Funds will be used to acquire additional shareholding in Harmony Medicare Private Limited, enhancing the Company’s stake.

4. Capital Expenditure for New Hospital in Vadodara – INR 30.1 Cr

Funds will be utilized to set up a new hospital in Vadodara, expanding the Company’s healthcare services.

5. Robotics Equipment for Vadodara Hospital – INR 6.8 Cr

The Company will purchase robotics equipment for Gujarat Kidney & Super Specialty Hospital in Vadodara.

6. Repayment of Secured Borrowings – INR 1.2 Cr

A portion of proceeds will be used for the repayment of certain secured borrowings to improve the Company’s financial position.

Gujarat Kidney IPO booked 1.92 times so far. Here's how different quotas were booked:

QIB: 34%

NII: 2.24x

Retail: 6.99x

Gujarat Kidney and Super Speciality Limited has grown its scale and profitability on the back of an asset-heavy but efficient hospital model, with improving margins driven by better case mix, higher occupancy, and operating leverage from its existing infrastructure.

The entire ₹250.80 Cr (100%) IPO is a Fresh Issue, with zero Offer for Sale (OFS), signalling strong promoter confidence. Approximately ₹77 Cr is earmarked for the landmark acquisition of Parekhs Hospital in Ahmedabad, while ₹30 Cr will fund a new greenfield Women’s Hospital in Vadodara. Additional funds are allocated for robotic surgical equipment and increasing stakes in high-performing subsidiaries.

Despite the competitive nature of the healthcare sector, Gujarat Kidney’s asset-light integration model and its dominance in the renal care niche allow it to capitalize on the rising demand for quality healthcare in semi-urban India. We recommend a ‘SUBSCRIBE’ rating for long-term investors.

— Anshul Jain, Lakshmishree

Gujarat Kidney IPO's second day of bidding kicked off at 10 am today. Investors can place the bids till 5 pm today. As of the first day, the IPO was booked 1.47 times, eliciting strong response from NII and retail investors.

The initial public offering of healthcare company Gujarat Kidney and Super Speciality Ltd received 1.47 times subscription on the first day of share sale on Monday.

The IPO received bids for 1,94,25,792 shares against 1,32,26,880 shares on offer, according to NSE data. The category for Retail Individual Investors (RIIs) fetched 4.69 times subscription, while the quota for non-institutional investors got subscribed 1.96 times. The category for Qualified Institutional Buyers (QIBs) received 34 per cent subscription.

The grey market premium (GMP) for Gujarat Kidney IPO has declined. Gujarat Kidney IPO GMP today is ₹4 as against ₹7 earlier. At the current GMP, Gujarat Kidney IPO listing price could be ₹118, a premium of 3.5% against the IPO price.