GPT Healthcare shares list at 16% premium over IPO price

Shares of GPT Healthcare made a decent debut on the stock exchanges on Thursday, in an otherwise muted broader market. The share price of the healthcare arm of GPT Group, which owns and operates mid-sized multispecialty hospitals under the ILS Hospitals brand, was listed at ₹216.15 on the BSE, a premium of 16.2% over the issue price of ₹186 apiece. On the NSE, GPT Healthcare shares opened at ₹215, up 15.6% over the IPO price.

Post listing, GPT Healthcare shares gained as much as 18.1% to ₹219.70, while it dropped to ₹200.20 levels. On the NSE, the stock hit a high and low of ₹219.90 and ₹200.10, respectively, in the first hour of trade so far.

At the time of reporting, shares of GPT Healthcare were trading at ₹208.20, up 11.9% against the issue price, while the market capitalisation stood at ₹1,708 crore.

The listing of GPT Healthcare was better than Street expectation as the stock was commanding a grey market premium (GMP) of ₹17 over the issue price ahead of listing, signaling listing to be around ₹203. 

“Allottees who applied for the public offering for listing premium are advised to maintain their stop loss at Rs. 190 and wait for further upside, whereas those who have a medium- to long-term perspective can also hold the stock,” says Shivani Nyati, Head of Wealth at Swastika Investmart Ltd.

“The company has strategically concentrated on the comparatively unexplored healthcare industry in Eastern India, where it operates in three cities. The company's location and specialty mixes are both very diversified. On the other hand, the company faces competition from other healthcare service providers, and it has a low occupancy rate,” Nyati adds.

GPT Healthcare raised ₹525.14 crore via IPO route, comprises a fresh issue of ₹40 crore, and an offer for sale (OFS) of 26,082,786 equity shares worth ₹485.14 crore by the selling shareholder, BanyanTree Growth Capital II, LLC. The company intends to use fund raised from fresh equities for repayment of certain outstanding loans availed by the company from banks and financial institutions. A part of the fund will be used for general corporate purposes.

The issue, which opened for bidding between February 22-26, was subscribed 8.52 times, received bids of 16,84,27,600 shares against the offered 1,97,63,327 equity shares, at a price band of ₹177-186. The quota reserved for qualified institutional buyer (QIB) was subscribed 17.30 times, whereas non-institutional investors and retail portions were booked 11.02 times and 2.44 times, respectively.

Incorporated in 1989, Kolkata-based GPT Healthcare owns and operates multispeciality neighbourhood tertiary care hospitals in Eastern India. Founded by Dwarika Prasad Tantia and Dr Om Tantia, the company operates four full service multispecialty hospitals, with a total capacity of 561 beds and attends to over 35 specialties and super specialties such as internal medicine, diabetology, gastroenterology, orthopaedics and joint replacements, interventional cardiology, neurology, neurology, neurosurgery, paediatrics and neonatology. 

For the financial year ended March 31, 2023, the company reported 7% rise in total income to ₹366.7 crore, primarily due to the increases in income from hospital services, aided by increase in patient volume, and increase in income from pharmacy sales. The profit after tax dropped to ₹39.01 crore from ₹41.66 crore in the last fiscal. For the six months ended September 30, 2023, revenue from operations stood at ₹204.17 crore and net profit at ₹23.48 crore. 

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