Maitreya Medicare IPO Review: Maitreya Medicare Limited is coming up with its Initial Public Offering. This is an SME (small and medium-sized enterprise) which is going to be listed on NSE SME. The IPO will open for subscription on 27th October 2023 and closes on 1st November 2023.
This article about Maitreya Medicare IPO Review, includes an in-depth analysis of the company’s financials, GMP and the strengths and weaknesses of Maitreya Medicare.
Table of Contents
Maitreya Medicare IPO – About The Company
Maitreya Medicare Limited (MML), a NABH-accredited hospital, was established in Surat City by Dr. Narendra Singh Tanwar in 2019. The hospital, with a capacity of 125 beds, provides affordable secondary and tertiary healthcare services across more than 18 specialities and super specialities.
These include Cardiology, Urology, Oncology, Laparoscopic Surgery, Neurology, Neurosurgery, Spine Surgery, Nephrology, Gastroenterology, Gastrointestinal surgery, Cardiothoracic Surgery, Oncosurgery, Orthopedic Surgery, Gynecology and high-risk Obstetrics, Hepatocellular Billary Surgery, and Critical Care Medicine among others.
Maitreya Medicare has two subsidiaries: Maitreya Hospital Private Limited (MHPL) and Maitreya Lifescience Private Limited (MLPL)
During the financial year 2023, the hospital has served 11,287 patients in total, including 7,208 for OPD and diagnostics and 4,079 for indoor services.
Maitreya Medicare IPO Review – Industry Overview
The healthcare industry is one of the largest and fastest-growing sectors in India, generating revenue and employment opportunities. It comprises hospitals and diagnostic centres (71%), domestic pharmaceuticals (20%), and medical devices (9%).
The West India market is expected to grow at 16% CAGR from ₹ 1.15 trillion in Fiscal 2022 to ₹ 2.25 trillion by Fiscal 2027.
India has a competitive edge in terms of its skilled medical professionals and low-cost medical services, which attract medical tourists from across the world. The medical tourism market was worth US$ 2.89 billion in 2020 and is projected to reach US$ 13.42 billion by 2026.
The Government aims to make India a global healthcare hub and plans to increase public health spending to 2.5% of GDP by 2025. The Union Budget 2023 allocated ₹ 88,956 crores to health expenditure, a 2.71% increase from ₹ 86,606 crores in FY 2023-24.
The hospital industry is forecast to grow to Rs. 8.6 trillion at a CAGR of 16–17%. The medical devices industry also offers immense opportunities for investors and service providers, as India is a leading destination for high-end diagnostic services and capital investment.
Maitreya Medicare – Financials
Maitreya Medicare has experienced substantial financial growth, with its net worth soaring from ₹3.8 Cr in March 2021 to ₹8.6 Cr in March 2023. Despite a decrease in revenue from ₹56.6 Cr to ₹39.3 Cr, attributed to the correction of the COVID-19 wave impact, the Profit After Tax (PAT) remained stable at around ₹4.2 Cr. Notably, the company’s borrowing decreased from ₹9.1 Cr in March 2021 to ₹5.8 Cr in March 2023.
In the recent quarter, the company reported a revenue of ₹24.7 Cr and a PAT of ₹2.5 Cr.
As of 2023, the company’s key financial indicators are as follows: Return on Equity (ROE) at 50.15%, and Return on Capital Employed (ROCE) at 42.71%.
FINANCIAL METRICS
(Source: RHP of the company)
Competitors of the company
The listed peers of the company include Shalby Limited, KMC Speciality Hospitals (India) Limited, and Global Health Limited
Strengths of the Company
- Diversified Healthcare Services: Maitreya Medicare offers a comprehensive range of healthcare services across over 18 specialities and super specialities, integrated diagnostic services, and pharmacies, making it a strong and diversified healthcare provider.
- Expansion Potential: The hospital is a 125-bedded unit with the potential to expand by an additional 75 beds to become a 200-bedded structure. It plans to offer quaternary care facilities like Organ Transplants and Robotics in the near future.
- Advanced Infrastructure: The hospital boasts premier facilities such as a Cathlab, two Modular Superspeciality Operation Theatres with Laminar Air Flow and HEPA Filters, well-equipped 20-bedded Intensive Care Units with ECMO and CRRT, and excellent support services like Pathology and Radiology including CT scan.
- Quality Assurance & Experienced Management: Maitreya Medicare is NABH accredited, indicating its commitment to quality healthcare. It is managed by an experienced and qualified professional team that focuses on providing cost-effective healthcare in under-served areas with dense populations, including tier-2 and tier-3 cities.
Weaknesses of the Company
- Supplier Dependence: The company’s reliance on a limited number of suppliers for medicines and consumables, who in turn depend on third-party suppliers, poses a risk. Any failure to negotiate favourable terms, unexpected price hikes, or supply shortages could increase procurement costs and adversely affect the business.
- Speciality Concentration: The company is heavily dependent on certain specialities like cardiology, neurology, orthopedics, and general medicine, which contribute around 85% of total revenue. Any negative impact on these services could result in a significant decline in revenue.
- Payment Delays: The company’s cash flow is vulnerable to delays in payments from patients, insurance companies, and government health schemes. Furthermore, any negative alterations in these regulations or policies could detrimentally impact the business.
- Geographical Concentration: The company’s operations are based in Surat, Gujarat. This concentration of revenue from a single location poses a risk. Any localised social unrest, natural disasters, or breakdown of services could reduce customers and revenue.
Maitreya Medicare IPO Review – GMP
As of 25th October 2023, The IPO of Maitreya Medicare is set at a price band of ₹78 to ₹82. The last grey market price stands at ₹50. The IPO is projected to list at a premium of 60.98%, with an estimated listing price of ₹132.
Key IPO Information
| PARTICULARS | DETAILS |
|---|---|
| IPO Size | 14.89Cr |
| Fresh Issue | 14.89Cr |
| opening date | 27th october 2023 |
| closing date | 1st November 2023 |
| face value | ₹10 per share |
| price band | ₹78 to ₹82 per share |
| lot size | 1600 shares |
| Minimum lot | 1 (1600 shares) |
| maximum lot | 1 (1600 shares) |
| Investment amount | ₹1,31,200 |
| listing date | 9th November 2023 |
Promoters: Dr Narendra Singh Tanwar, Dr Pranav Rohitbhai Thaker and Mr Vimalkumar Natverlal Patel are the Promoters of the company
Book Running Lead Manager: GYR Capital Advisors Private Ltd
Registrar to the Offer: Link Intime India Private Limited
The Objective of the Issue:
The hospital intends to utilize the proceeds of the Issue to meet the following objectives:
- Making investment through Equity in the subsidiary named ‘Maitreya Hospital Private Limited’ for setting up a Hospital at Valsad, Gujarat.
- Redemption of part of issued Non-Convertible Redeemable Preference Shares
- Working Capital requirements of the company
- General Corporate Purposes.
In Closing
Maitreya Medicare Limited has demonstrated consistent growth, expanding from a 67-bed capacity in 2021 to 125 beds in 2023. Serving South Gujarat from Bharuch to Vapi and Songadh to Surat, the company continues to enhance its quality of care by investing in the latest technology.
Despite operating in a competitive environment against various hospitals, clinics, diagnostic chains, and dispensaries, Maitreya Medicare Limited is poised for further growth. The company’s expansion plans include the development of a multi-super speciality hospital through its subsidiary, Maitreya Hospital Private Ltd, in Valsad, Gujarat, designed to accommodate over 125 beds.
However, it is important to note that this is an SME IPO where the minimum investment amount is ₹1,31,200 Which is higher than the mainline IPO.
What do think the future holds for the company? Are you applying for the IPO? Let us know in the comments below.
Written By Niharika Jadhav
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