Krsnaa Diagnostics IPO: 9 things you should know about the issue

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Diagnostic chain Krsnaa Diagnostics is set to raise Rs 1,213.76 crore through an initial public offer (IPO) next week. Here are all the details about the offer.

Open and close date: The offer will open for subscription on August 04 and the bidding will close on August 06. The anchor book, if any, will open for a day before the issue opening, i.e. August 03.

Price band: The price band for Krsnaa Diagnostics has been fixed at Rs 933-954 per share having a face value of Rs 5 per share.

Lot size: Investors can bid for a minimum of 15 equity shares and in multiples, thereafter, translating to a minimum bidding amount of Rs 14,310 at the higher end of the price band. A retail investor can at max apply for 13 lots or 195 shares for Rs 1,86,030.

Issue size: The Rs 1,213.76-crore public offer comprises fresh issuance of equity shares of Rs 400 crore, and an offer for sale (OFS) of 8.53 million shares totalling to Rs 813.76 crore. The OFS comprises sale of 1.6 million shares by PHI Capital Trust-PHI Capital Growth Fund-I, up to 3.34 million shares by Kitara PIIN 1104, up to 3.56 million shares by Somerset Indus Healthcare Fund I Ltd and up to 21,380 shares by Lotus Management Solutions.

Objective of issue: Rs 150.81 crore of the fresh issue will be used for financing the cost of establishing diagnostics centers at Punjab, Karnataka, Himachal Pradesh and Maharashtra. While the firm will use Rs 125.70 crore for repayment of certain borrowings availed by it. As of June 2021, the total debt under the various financing arrangements of the company aggregated to Rs141.73 crore. And the rest will be utilised for general corporate purpose.

What’s in it for retail investors: Not more than 75% of the total offer has been reserved for qualified institutional buyers, up to 10% for retail investors, and the rest 25% for non-institutional buyers.

About the company: Krsnaa Diagnostics is one of the fastest-growing diagnostic chains in India. The company offers a wide range of diagnostic services such as imaging/radiology services (X-rays, MRI, etc.), routine clinical laboratory tests, pathology, and tele-radiology services to private and public hospitals, medical colleges, and community health centres.

As of December 31, 2020, it operates 1,801 diagnostic centres that are offering radiology and pathology services across 13 different cities in India. In fiscal 2020, the business has served 5.27 million patients.

For the financial year ended March 31, 2021, the company reported total revenue of Rs 604.53 crore compared to Rs 528.99 crore in FY19. During the same period the company turned into black as it posted a profit of Rs 184.93 crore in FY21 versus a loss of Rs 58.06 crore in FY19.

Book Running Lead Managers and Registrar to the IPO: The book running lead managers to the issue are JM Financial, DAM Capital Advisors, Enquires Capital and IIFL Securities. The registrar to the issue is KFintech.

Issue timeline: The issue is likely to finalize the basis of allotment by August 11, and the initialization of refunds will take place by August 12. While the credit of equity shares to depository accounts of the allottee will be done on August 13. The diagnostics chain is expected to make its stock market debut on August 17, 2021.