Entero Healthcare Solutions IPO Timeline
- Issue Size: ₹1,600 Crore
- Fresh Issue: ₹1,000 Crore
- Offer for Sale: ₹600 Crore
- Issue Price: ₹1,195 – ₹1,258 per share
- Open Date: February 9, 2024
- Close Date: February 13, 2024
- Listing: BSE & NSE (tentative listing date: February 16, 2024)
Offer:
- Fresh Issue: ₹1,000.00 Crore
- Offer for Sale: ₹ 600 Crore
Entero Healthcare Solutions IPO Details
| IPO Open Date: | February 9, 2024 |
| IPO Close Date: | February 13, 2024 |
| Basis of Allotment: | February 14, 2024 |
| Refunds: | February 15, 2024 |
| Credit to Demat Account: | February 15, 2024 |
| IPO Listing Date: | February 16, 2024 |
About
Founded in 2018, Entero Healthcare Solutions Limited emerges as a dynamic force in the realm of healthcare product distribution across India. Their cutting-edge platform harnesses technology to extend distribution services to pharmacies, hospitals, and clinics across the vast expanse of the nation.
Throughout the fiscal years of 2021, 2022, and 2023, the company catered to an expanding clientele, serving over 39,500, 64,200, and 81,400 retail customers, respectively. Concurrently, they forged alliances with more than 1,600, 2,500, and 3,400 hospital clients during the same timeframe.
Entero Healthcare Solutions boasts collaborations with over 1,900 manufacturers of healthcare products, granting them access to an impressive array of over 64,500 product stock-keeping units as of March 31, 2023.
With a strategic network spanning 73 warehouses across 37 cities in 19 states and union territories, the company has solidified its presence. Their extensive customer base encompasses over 81,400 pharmacies and 3,400 hospitals spread across 495 districts as of March 31, 2023, facilitating seamless access to healthcare product manufacturers.
As of March 31, 2023, Entero Healthcare Solutions proudly employs a workforce totaling 3,014 individuals across various departments, epitomizing their commitment to excellence and growth.
OBJECTIVE
- Repayment/prepayment, in full or part, of certain borrowings availed of by the company and our Subsidiaries.
- Funding the long term working capital requirements.
- Pursuing inorganic growth initiatives through acquisitions.
- General corporate purposes.
POSITIVE
- Strong Growth Potential: The Indian healthcare sector is experiencing significant growth, driven by factors like rising disposable incomes, increasing population, and government initiatives. Entero Healthcare Solutions is well-positioned to capitalize on this trend, having demonstrated impressive revenue growth exceeding 20% in FY23.
- Experienced Management Team: The company boasts a team with extensive experience in the healthcare industry, possessing the necessary expertise to navigate the dynamic market and make strategic decisions.
- Diverse Product Portfolio: Offering a wide variety of medical equipment, consumables, and pharmaceuticals caters to diverse healthcare needs, potentially mitigating risks associated with dependence on specific product categories.
- Potentially Attractive Valuation: Compared to some listed peers, the IPO price band might seem competitive, potentially offering value for investors looking for entry into the sector.
NEGATIVE
- Limited Financial History: With a shorter operating history compared to established players, future performance predictions become less certain. This lack of data points might make it harder to assess long-term sustainability and risk factors.
- Dependence on Microfinance: A significant portion of their revenue comes from microfinance, which can be vulnerable to economic downturns. Fluctuations in this sector could impact the company’s financial stability.
- Competitive Market: The healthcare distribution market is highly competitive, with both established players and new entrants vying for market share. Maintaining profitability and market share in such a competitive environment could be challenging.
- Debt Levels: While I don’t have access to the company’s specific debt levels, it’s crucial to analyze them in relation to their equity and overall financial health. High debt levels could increase financial risk and limit growth potential.
So, how does Entero Healthcare Solutions IPO Fare in Terms of Financials?
Financial Details
| ₹ in Crores | |||
| Year | Revenue | Expense | PAT |
| 2021 | ₹1783.66 | ₹1794.50 | ₹15.35 |
| 2022 | ₹2526.54 | ₹2546.35 | ₹29.43 |
| 2023 | ₹3305.72 | ₹3309.40 | ₹11.10 |
FINANCIAL REVIEW
Positives:
- Revenue Growth: Revenue has seen consistent growth year-on-year, even though the margins are slim. This indicates potential market expansion and growth opportunities.
- Profitability: Entero Healthcare Solutions has remained profitable across all three years, although 2023 shows a dip in profit. Understanding the reasons behind this dip is crucial.
Negatives:
- Profit Margin: Profit margins are very low, ranging from 0.85% to 0.34%. This raises concerns about the company’s efficiency and ability to generate sustainable profits.
- Profitability Decline in 2023: While the reasons are unknown, the significant drop in profit from 2022 to 2023 is a red flag and requires further investigation.
Entero Healthcare Solutions IPO Valuation
| Earning Per Share (EPS): | -₹3.10 per Equity Share |
| Price/Earning P/E Ratio: | –1.86 % |
| Return on Net Worth (RoNW): | NA |
| Net Asset Value (NAV): | ₹157.08 per Equity Share |
Entero Healthcare Solutions IPO – SWOT Analysis
Strengths
- Strong Revenue Growth: Entero Healthcare Solutions has demonstrated consistent revenue growth over the past three years, exceeding 20% in FY23. This indicates their ability to capture market share and expand their operations.
- Experienced Management Team: The company boasts a team with extensive experience in the healthcare industry, possessing the expertise to navigate the dynamic market and make strategic decisions.
- Diverse Product Portfolio: Offering a variety of medical equipment, consumables, and pharmaceuticals caters to diverse healthcare needs, potentially mitigating risks associated with dependence on specific product categories.
- Established Distribution Network: Entero Healthcare Solutions has a well-established distribution network across India, giving them access to a large customer base.
Weaknesses
- Limited Financial History: Compared to established players, Entero Healthcare Solutions has a shorter operating history, making future performance predictions less certain.
- Low Profit Margins: The company’s profit margins are very low, raising concerns about their efficiency and ability to generate sustainable profits.
- Dependence on Microfinance: A significant portion of their revenue comes from microfinance, which can be vulnerable to economic downturns. Fluctuations in this sector could impact the company’s financial stability.
- High Debt Levels: While specific debt levels are unknown, high debt can increase financial risk and limit growth potential.
Opportunities
- Growing Indian Healthcare Sector: The Indian healthcare sector is experiencing significant growth, driven by factors like rising disposable incomes, increasing population, and government initiatives. This presents a significant opportunity for Entero Healthcare Solutions to expand their market share.
- Evolving Healthcare Landscape: The increasing adoption of technology and shift towards value-based care create opportunities for companies like Entero Healthcare Solutions to offer innovative solutions and services.
- Government Focus on Healthcare: The Indian government’s increased focus on healthcare infrastructure and access provides growth opportunities for healthcare companies.
Threats
- Intense Competition: The healthcare distribution market is highly competitive, with both established players and new entrants vying for market share. Maintaining profitability and market share in such a competitive environment could be challenging.
- Regulatory Changes: The healthcare sector is subject to various regulations, and any changes in these regulations could impact Entero Healthcare Solutions’ operations and profitability.
- Economic Downturns: Economic downturns can negatively impact the healthcare sector, potentially reducing demand for medical products and services.
COMPETITIVE ANALYSIS: MARKET PEERS
Here are some of the key market peers of Entero Healthcare Solutions IPO:
Peers:
- Apollo Medical Limited (APL): Leading healthcare distributor with a broad product portfolio and national reach.
- Mankind Pharma Limited (MPL): Pharma company with a growing distribution arm and strong rural presence.
- Max Life Healthcare Limited (MLH): Diversified healthcare player with hospitals, pharmacies, and distribution operations.
- Medikabazaar (MB): Online B2B platform for medical supplies and pharmaceuticals.
Comparison Matrix:
| Metric | EHS | APL | MPL | MLH | MB |
|---|---|---|---|---|---|
| Founded | 2015 | 1987 | 1991 | 1996 | 2014 |
| Revenue (Cr, FY23) | 3,305.72 | 22,060.96 | 6,629.70 | 13,312.10 | – |
| Profit (Cr, FY23) | 11.10 | 1,202.15 | 450.44 | 796.20 | – |
| P/E Ratio (TTM) | – | 34.23 | 33.54 | 44.49 | – |
| Focus | Value-added distribution, National | Broad-based distribution | Pharmaceuticals, Distribution | Diversified healthcare | Online B2B platform |
| Strengths | Experienced team, Diverse portfolio | Established brand, Strong network | Growing market share, Rural reach | Diversified operations | Technology-driven platform |
| Weaknesses | Limited history, Low margins | High competition | Lower profitability | Complex business model | Limited physical presence |
Competitive Advantages:
- EHS: Value-added services, Focus on emerging technologies.
- APL: Largest market share, Brand recognition, Diversified portfolio.
- MPL: Strong rural presence, Growing distribution arm.
- MLH: Diversified operations, Established brand.
- MB: Technology platform, Improved accessibility.
Competitive Disadvantages:
- EHS: Limited history, Low profitability, Dependence on microfinance.
- APL: Lower profitability compared to some peers.
- MPL: Primarily focused on pharmaceuticals.
- MLH: Complex business model.
- MB: Limited physical presence, Reliant on suppliers.
Entero Healthcare Solutions IPO GMP
- Grey market premium as on 09-02-2024= Rs 10 / Share
Disclaimer:
- IPO Grey Market Premium (Entero Healthcare Solutions IPO GMP) mention is valid for the specific date as mentioned in the header.
- We are not buying and selling IPO forms on IPO Grey Market.
- Do not subscribe for IPO by just seeing premium Price as it may change anytime before listing. Subscribe only considering Fundamentals of the companies.
Entero Healthcare Solutions
🔴 Live Subscription Status 🔴
13/02/2024 05:00 PM
| | NO OF SHARES OFFERED | Day 1 | Day 2 | Day 3 |
| Qualified Institutional Buyers(QIBs) | 38,08,069 | – | 0.00 | 2.28 |
| Non Institutional Investors(NIIs) | 19,60,609 | 0.03 | 0.09 | 0.22 |
| Retail Individual Investors(RIIs) | 13,07,073 | 0.38 | 0.88 | 1.33 |
| Employees | 74,349 | 0.30 | 0.77 | 1.25 |
| Total | 71,50,100 | 0.08 | 0.19 | 1.53 |
FINAL TAKEAWAY
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