Sagility India submits draft papers for IPO, seeks approval from SEBI

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New Delhi: Sagility India Ltd is a provider of technology-enabled healthcare services. It has submitted initial documents to the markets regulator Sebi for an initial public offering (IPO). The regulatory body overseeing securities markets in India, to initiate the process of launching their initial public offering (IPO). This paperwork typically includes essential details about the company’s financials. It also has operations and intended use of funds from the IPO. Sebi will review before granting approval for the IPO to proceed.

Offer for sale:

The proposed IPO of the Bengaluru-based company, as detailed in the Draft Red Herring Prospectus (DRHP), consists solely of an Offer for Sale (OFS) of 98.44 crore shares by the promoter, Sagility B.V. This means that the IPO does not involve the issuance of new shares by the company to raise fresh capital from the market. Instead, the existing promoter, Sagility B.V., intends to sell their shares to the public through this IPO.

In essence, an Offer for Sale (OFS) allows existing shareholders, in this case, Sagility B.V., to sell their shares directly to investors through the IPO. The proceeds from the sale of these shares go to the selling shareholder (Sagility B.V.) rather than to the company itself. This type of IPO is common when existing shareholders, such as promoters or early investors, wish to partially or fully monetize their investments by selling their shares to the public.

The offer includes a provision for eligible employees to subscribe.

Since it is an Offer for Sale (OFS), the company will not receive any proceeds from the public issue, and all funds will be received by the selling shareholders.

In its draft papers filed on Friday, the company stated that the purpose of the initial share sale is to leverage the benefits of listing its equity shares on the stock exchanges.

As per PTI, the company anticipates that listing the equity shares will boost its visibility and brand image, provide liquidity to its shareholders, and establish a public market for the equity shares.

The company provides technology-driven services to both payers (US health insurance companies, which finance and reimburse the cost of health services), and providers (primarily hospitals, physicians, and diagnostic and medical devices companies).

In March 2024, Sagility acquired BirchAI, a healthcare technology firm specialising in cloud-based generative AI technology. This acquisition is expected to enhance member and provider engagement and reduce clients’ operational costs through AI-powered customer support solutions using speech-to-text and large language models (LLMs) integrated with Sagility’s engagement solutions.

As of March 31, 2024, Sagility had 35,044 employees – 60.52 per cent of them women – up from 30,830 a year earlier.

Sagility India’s revenue from operations during the fiscal year 2024 increased 12.7 per cent to ₹4,753.56 crore against ₹4,218.41 crore a year ago. Its profit after tax soared 50 per cent to ₹228.27 crore for FY2024 from ₹143.57 crore in the preceding year.

ICICI Securities, IIFL Securities, Jefferies India, and J.P. Morgan India are the book-running lead managers to the issue. The company’s equity shares are proposed to be listed on the BSE and NSE.

With inputs from PTI