Back
PremiumSagility IPO Day 2 Highlights: Sagility India, a provider of technology-enabled services in the healthcare sector, saw 52 per cent bids for its initial public offering (IPO) on the second day of the bidding process.
The offer received a strong response from retail investors, with their portion subscribed 2.24 times. Meanwhile, the quota reserved for eligible employees also saw robust demand, garnering 2.44 times bids.
The non-institutional investor (NII) portion was booked 24 per cent while the qualified institutional buyer (QIB) quota was subscribed seven per cent.
The IPO, which opened today (November 5), will close on Thursday, November 7. The issue has a price range of ₹28-30 per share. On Monday, it raised more than ₹945 crore from anchor investors.
The Bengaluru-based firm's initial public offering (IPO) consists entirely of an offer for sale (OFS) of 70.22 crore shares from promoter Sagility BV. At the top end of the pricing range, this amounts to ₹2,106.60 crore. As this is an OFS, the company will not benefit from any funds raised through the public offering, with all proceeds going to the selling shareholders.
According to the company, this initial share sale aims to take advantage of the benefits associated with having its equity shares listed on the stock exchanges.
The firm offers technology-based services to payers (US health insurance companies that cover and reimburse health service expenses) and providers (mainly hospitals, doctors, and companies dealing with diagnostic and medical devices).
Stay tuned for review, subscription status, more.
The IPO of Sagility India was subscribed 52% at the end of the second day of the bidding process on Wednesday. The retail portion garnered 2.24 times bids, while the employee portion was booked 2.44 times.
Non-institutional investor (NII) portion was subscribed 24% while qualified institutional buyers' quota was booked 7%.
The initial public offering (IPO) of Sagility India, a healthcare technology-enabled services provider, attracted 50 percent subscription on the second day of bidding, November 6. The offering received nearly 19 crore bids against 38.7 crore shares available, according to data from the NSE.
The initial public offering (IPO) of Sagility India, a healthcare technology services provider, reached 40 percent subscription by the close of the second day of bidding on November 6. Data from the National Stock Exchange (NSE) indicates that investors placed nearly 14 crore bids for the 38.7 crore shares on offer.
The IPO price band is set between ₹28 and ₹30 per share, and investors can apply with a minimum lot size of 500 shares.
Details on the grey market premium (GMP) remain unclear, with expectations that it may fluctuate based on subscription levels and investor sentiment.
Mumbai: Sagility India Ltd.'s initial public offering (IPO), valued at ₹2,106 crore, has reached a subscription level of 26% by 10:06 a.m. on its second day of bidding. The IPO, which received 22% subscription on the first day, is entirely an offer for sale, with no fresh shares being issued.
Sagility India IPO GMP today or Sagility India IPO grey market premium was ₹0, which meant shares were trading at their issue price of ₹30 with no premium or discount in the grey market according to investorgain.com.
Considering the grey market trends over the past nine sessions, today's IPO GMP shows a downward trend and is anticipated to decrease further. The minimum GMP recorded is ₹0, while the maximum GMP stands at ₹3, as per experts at investorgain.com.
'Grey market premium' indicates investors' readiness to pay more than the issue price.
Sagility India's IPO garnered bids for 8,66,82,500 shares as against 38,70,64,594 shares on offer, suggesting that the issue was subscribed 22% on the first day of the bidding process on Tuesday, November 5.
Both employee and retail investors' portions sailed through today, while the qualified institutional buyer (QIB) quota did not see any bids.
The retail portion was subscribed 1.09 times, the employee quota was booked 1.35 times while the segment reserved for non-institutional investors (NIIs) saw 7% subscription.
Healthcare is an intricate segment of the U.S. economy, accounting for 17.1% of its nominal GDP and totalling US$4.7 trillion ( ₹389.6 trillion) in 2023, according to the latest projections by the Centers for Medicare & Medicaid Services (CMS). This expenditure has grown at a CAGR of 5.0% from 2014 to 2023. Notably, healthcare expenditure surged to 19.4% of nominal GDP in 2020 during COVID-19, reaching US$4.1 trillion ( ₹346.0 trillion).
Furthermore, CMS anticipates that healthcare expenditure will grow at a CAGR of 5.5%, reaching US$6.1 trillion ( ₹509.8 trillion) by 2028.
(Source: RHP)
As of June 30, 2024, the company had outstanding borrowings (current and non-current) amounting to ₹9,439.12 million, which primarily consisted of unsecured borrowings from related parties and accrued interest
50% of the Equity Shares allotted to Anchor Investors under the Anchor Investor Portion will be locked-in for a period of 90 days from the date of allotment. The remaining 50% of Equity Shares allotted to Anchor Investors under the Anchor Investor Portion will be locked-in for a period of 30 days from the date of allotment.
The retail portion of Sagility India IPO was fully booked on the first day of the bidding process on Tuesday, November 5. Overall, the IPO was subscribed 20% as of 3.45 pm.
Key details of Sagility IPO
The healthcare operations spend in the U.S. has grown at a CAGR of approximately 3.2% from 2014 to 2023 and was valued at approximately US$201.1 billion ( ₹16.8 trillion) in 2023. This spend is expected to grow at a CAGR of approximately 5.2% to reach approximately US$258.9 billion ( ₹21.6 trillion) in 2028.
The U.S. healthcare industry is characterized by complex services, stringent compliance requirements, intricate performance measures, and multifaceted payment workflows. These challenges necessitate the involvement of specialized service providers who possess the expertise to navigate and manage these complexities effectively.
Sagility India Limited is one of the leading tech-enabled healthcare specialists, with comprehensive coverage across healthcare payer and provider markets. The company’s deep, long-term, expanding client relationships across healthcare payers and providers foster high client stickiness and retention.
Investors interested in the company can consider investing in the IPO for the long term.
The initial public offer of Sagility IPO has been subscribed 17% on the first day of subscription today, at 14:15 IST, as per BSE data.
The initial share sale received bid for 6,67,68,500 shares against 38,70,64,594 shares on offer, at 14:15 IST, according to BSE.
The portion for retail investors received 85% subscription while the quota for non-institutional investors got subscribed 5%. The qualified institutional buyers (QIBs) part is yet to be booked. The employee portion has been subscribed 1.07 times.
Company’s services to Payers (primarily hospitals, physicians, and diagnostic and medical devices companies) cater to various aspects of their operations including (i) core benefits administration functions such as claims management, enrolment, benefits plan building, and premium billing, and (ii) clinical functions such as utilization management, care management, and population health management.
Company’s services to Providers (primarily hospitals, physicians, and diagnostic and medical devices companies) include revenue cycle management functions such as financial clearance, medical coding, billing, and accounts receivable follow-up services.
ICICI Securities Limited, Iifl Securities Ltd, Jefferies India Private Limited, and J.P. Morgan India Private Limited serve as the book-running lead managers for the Sagility India IPO, with Link Intime India Private Ltd acting as the registrar for the offering.
The initial public offer of Sagility IPO has been subscribed 11% on the first day of subscription today, at 12:15 IST, as per BSE data.
The initial share sale received bid for 4,24,22,000 shares against 38,70,64,594 shares on offer, at 12:15 IST, according to BSE.
The portion for retail investors received 55% subscription while the quota for non-institutional investors got subscribed 3%. The qualified institutional buyers (QIBs) part is yet to be booked. The employee portion has been subscribed 62%.
Sagility India is a solutions and services provider that leverages technology to focus solely on healthcare, catering to Payers, which are US health insurance companies that cover and reimburse health services costs, and Providers, mainly consisting of hospitals, physicians, and companies involved in diagnostics and medical devices.
Founded in July 2021, the company completed the acquisition of the healthcare services division from its predecessor, Hinduja Global Solutions, in January 2022 for a total of $449 million.
The initial public offer of Sagility IPO has been subscribed 8% on the first day of subscription today, at 11:18 IST, as per BSE data.
The initial share sale received bid for 3,05,52,000 shares against 38,70,64,594 shares on offer, at 11:18 IST, according to BSE.
The portion for retail investors received 40% subscription while the quota for non-institutional investors got subscribed 2%. The qualified institutional buyers (QIBs) part is yet to be booked. The employee portion has been subscribed 41%.
The company functions within the highly competitive healthcare services sector. It encounters rivalry from healthcare specialists, extensive IT and business services firms, as well as product-oriented companies that focus on offering products or solutions for the healthcare sector. This level of competition may result in pricing pressures and other negative consequences.
The company reported a total income of ₹4,781.50 crore and a net profit of ₹228.27 crore, with income experiencing a 144.4% CAGR from FY22 to FY24. In 1QFY2025, the total income was ₹1,247.76 crore, accompanied by a net profit of ₹22.29 crore. For FY24, the adjusted EBITDA stood at ₹1,171.4 crore, reflecting a margin of 23.48%, while the cash flow from operations accounted for 87.21% of EBITDA, demonstrating robust operational cash generation.
The initial public offer of Sagility IPO has been subscribed 2% on the first day of subscription today, at 10:12 IST, as per BSE data.
The initial share sale received bid for 73,09,500 shares against 38,70,64,594 shares on offer, at 10:12 IST, according to BSE.
The portion for retail investors received 9% subscription while the quota for non-institutional investors got subscribed 1%. The qualified institutional buyers (QIBs) part is yet to be booked. The employee portion has been subscribed 5%.
Sagility India Ltd was founded in July 2021 and took over the healthcare services division of Hinduja Global Solutions in January 2022, positioning itself as a specialized provider of technology-enabled healthcare solutions for providers and payers in the US. Sagility has a market share of around 1.23% in the outsourced healthcare operations industry and has been acknowledged as a Leader in the 2023 rankings from Avasant and Everest.
As of January 2024, the company was serving 5 of the top 10 Payers by enrollment in the United States. In terms of finances, the company’s operational revenue increased by 9.6%, reaching Rs. 1,223 crores for the quarter that ended on June 30, 2024, compared to Rs. 1,116 crores for the same quarter in 2023. For the fiscal year 2024, the revenue grew by 12.69% to Rs. 4,753 crores, up from Rs. 4,218.4 crores in FY23. The company reported EBITDA margins of 23.5% for FY24 and 17.8% for the quarter ending June 30, 2024.
“The issue is valued at a P/E of 56.6x on the upper price band based on FY24 earnings, which is deemed fair. Therefore, we recommend a “SUBSCRIBE" rating for the issue," the brokerage said.
Client concentration is notable, with top 10 clients contributing 91.41% of revenue in FY24, though Sagility has expanded its client base with large-scale deals (>$20 million) increasing from three to five clients between FY22 and FY24.
Given Sagility’s healthcare-only focus across the payer and provider markets, there are no listed service providers in India or abroad that cater to US healthcare enterprises and are its immediate comparables in size and business model (which is categorised as a pureplay healthcare specialist).
“This issue is available at P/E of 56.60x and 150.00x of FY2024 and Q1FY2025. Annualised P/E of FY2025E appears aggressively priced. Despite this, Sagility’s strong technological offerings, stable revenue growth, and established client relationships position it as a promising long-term investment opportunity in the healthcare market. We recommend to SUBSCRIBE this issue for long-term gains," the brokerage said.
Sagility India raised ₹945 crores from anchor investors prior to its initial public offering, which is set to open for public subscription on Tuesday, November 5. The company announced to the stock exchanges that it allocated 31,51,34,668 equity shares at a price of Rs. 30 per share on Monday, November 4, 2024, to its anchor investors.
Among the foreign and domestic institutions that took part in the anchor investment were HDFC Mutual Fund, Nomura, Government Pension Fund Global (Norges Bank), ICICI Prudential Mutual Fund, Mirae Asset Mutual Fund, ICICI Prudential Life, WhiteOak Mutual Fund, Amundi, Allspring Global, Lion Global, Motilal Oswal Mutual Fund, and Max Life Insurance, among others.
Of the total 31,51,34,668 equity shares allocated to anchor investors, 11,84,03,500 equity shares were distributed to 8 domestic mutual funds across 26 schemes, totaling approximately ₹355 crore, which represents 37.57% of the overall anchor book size.
Sagility India IPO GMP today or Sagility India IPO grey market premium was ₹0, which meant shares were trading at their issue price of ₹30 with no premium or discount in the grey market according to investorgain.com.
'Grey market premium' indicates investors' readiness to pay more than the issue price.
Disclaimer: The views and recommendations above are those of individual analysts, experts and broking companies, not of Mint. We advise investors to check with certified experts before making any investment decision.
