VLCC Health Care IPO: The IPO consists of a fresh issue of Rs 300 crore by the company, as well as an offer by the promoters and investors to sell 89,22,672 equity shares.
On August 13, a beauty and wellness company, VLCC Health Care, refiled its Draft Red Herring Prospectus with SEBI, the capital markets regulator in order to raise funds through an IPO (Initial Public Offering).
Due to demonetization, the company had to cancel its IPO in 2016. According to The Times of India, VLCC Health Care IPO plans were once again canceled in 2019 due to the Lok Sabha elections.
The company will issue a fresh issuance of Rs 300 crore, as well as a promoter and investor offer to sell 89,22,672 equity shares in the initial public offering.
Mukesh Luthra, the company’s promoter, will sell 18,83,414 equity shares, while investors OIH Mauritius and Leon International will sell their whole shareholding of 18,97,540 (5.04 percent of pre-offer paid-up equity) and 51,41,718 equity shares, respectively (13.65 percent of pre-offer paid-up equity).
The firm and selling shareholders may explore a pre-IPO private placement of Rs 100 crore in conjunction with merchant bankers, and if the pre-IPO placement is completed prior to the filing of the RHP with the ROC, the fresh issue size will be decreased.
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The net proceeds from the new issuance would be used to establish and remodel VLCC Wellness Clinics in India and the (Gulf Cooperation Council) GCC region, as well as VLCC Institutes in India.
It would also use the funds to pay off debts, invest in brand development, digital and information technology infrastructure, and other general corporate objectives.
Vandana Luthra and Mukesh Luthra, the company’s promoters, own 68.72 percent of the company. Their total shareholding, including the promoter group, is 82.38 percent.
VLCC Health Care was founded in 1989 by Vandana Luthra as a beauty and weight management services center.
Incorporated in 1996, it has been developing a strategic integrated business model based on three core businesses: VLCC Wellness & Beauty clinics, VLCC personal care goods, and VLCC institutes for beauty and nutrition skill development.
In the next five years, the Indian health and beauty market is predicted to develop at a CAGR of 10-12 percent, reaching $40-42 billion by FY25.
The industry is rapidly transitioning from disorganized to organized. From roughly 25-30 percent in FY20, the organized sector is likely to increase its market share to around 30-35 percent in FY25.
During the Covid-19 epidemic, the company’s focus on service performance and customer engagement helped it increase repeat customer sales, which increased from 50.6 percent in FY20 to 60.5 percent in FY21 for Wellness Clinics in India.
As a result, in the financial year ending March 2021, they reported a profit of Rs 6.24 crore on revenue of Rs 532.92 crore.
However, it lost Rs 15.31 crore in FY20 on revenue of Rs 769.57 crore, compared to Rs 52.7 crore on revenue of Rs 852.43 crore in FY19.
