Medanta Hospitals operator Global Health extends listing gains to close 24% higher than issue price

• Shares of Global Health that operates Medanta Hospitals listed at ₹398.15 against the allotment price of ₹336 per share.
• The IPO was subscribed 9.58 times amidst volatile market conditions.
• The market capitalisation of the company stood at ₹10,677 crore.

Shares of Global Health that operates Medanta Hospital rallied on the day of its debut, on Wednesday. It closed 23.7% higher than its issue price at ₹415.6.

The stock had listed at an 18.5% premium to its issue price, which was at ₹336 per share.

At the end of the day, investors were rewarded with listing gains of ₹79.6 per share. These gains are around four times the grey market predictions, that expected gains to the tune of ₹20 per share.

GMP is the premium at which IPO shares are traded in an unofficial market before they are listed on the stock exchanges.

The market capitalisation of the company stands at ₹10,677 crore, according to BSE data.

The IPO was subscribed 9.58 times amidst volatile market conditions. The qualified institutional buyer portion was subscribed 28.64 times. The reserved portion of non-institutional investors witnessed a subscription of 4.02 times. Retail portion saw poor demand as it had a subscription of just 0.88 times.

This year, 26 IPOs made their stock market debut on the BSE mainboard. Most of them gave positive listing gains, except seven issues. Here are the top five IPOs with highest listing gains in 2022.

Companies	Highest listing gains per share
Harsha Engineers International	₹155.90
Dreamfolks Services	₹136.65
Aether Industries	₹134.75
DCX Systems	₹101.80
Syrma SGS Technology	₹93.05

(Source: BSE)

The proceeds from the IPO will be invested in two of its subsidiaries -- Global Health Patliputra and Medanta Holdings in the form of debt or equity, for payment of debt.

The company has key specialities in cardiology and cardiac science, neurosciences, oncology, digestive and hepatobiliary sciences, orthopaedics, liver transplant, and kidney and urology. Global Health is backed by private equity investors such as Carlyle Group and Temasek.

Particulars	Revenue	Profit
FY22	₹1,339 crore	₹91 crore
FY21	₹876 crore	₹45 crore
FY20	₹899 crore	₹21 crore

Source: DRHP

While Covid-19 had initially impacted the health of the company, its profitability showed a dramatic turnaround in the last two fiscal years. However, the risk of future Covid variants remains and may impact its financial condition in the future.

“Further, as a result of the detection of new strains, evolving variants such as the ‘Omicron variant’ and subsequent waves of Covid-19 infections throughout the world, we may be subject to further lockdowns or other restrictions in the subsequent years, which may adversely affect our business operations,” said the company in the red herring prospectus.

Another drawback concerning the firm is continuing losses by subsidiaries, which may impact the parent company.

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