Dr. Agarwal’s Healthcare Files for IPO: Aiming to Raise ₹300 Crore with Major Backers on Board

Dr. Agarwal’s Healthcare, supported by Temasek Holdings and TPG, is set to launch an initial public offering (IPO) after submitting its application to the Securities and Exchange Board of India (SEBI) on September 27.

The IPO plans to raise ₹300 crore through new equity shares and includes an offer-for-sale (OFS) of 6.95 crore shares from promoters and investors. Key shareholders selling their stakes in the OFS are Amar Agarwal, Athiya Agarwal, and other family members, along with institutional investors like Arvon Investments, Claymore Investments (both linked to Temasek), and Hyperion Investments (backed by TPG).

Currently, the promoters own 37.83% of the company, with the remainder held by public shareholders. This includes Arvon with 12.45%, Claymore with 15.73%, and Hyperion with 33.75%.

Dr. Agarwal’s Healthcare operates 165 centers in India and 15 centers abroad, providing eye care services such as cataract surgeries and optical products. As of fiscal year 2024, the company holds about 25% of India’s eye care market.

Financial Highlights

The Indian eye care industry is projected to grow at a rate of 12-14% annually, rising from ₹37,800 crore in FY24 to around ₹55,000-65,000 crore by FY28.

Dr. Agarwal plans to use ₹195 crore from the new issue to pay down debt and the remainder for corporate needs and acquisitions. As of July 2024, its total debt stands at ₹384 crore. The company’s debt-to-equity ratio has improved, decreasing to 0.70x in FY24 from 1.3x in FY23.

Despite a 30.9% increase in revenue to ₹1,332 crore in FY24, net profit fell by 7.9% to ₹95 crore due to higher tax expenses. However, EBITDA rose by 34% to ₹362.3 crore, with margins slightly improving to 27.2%.

The IPO is being managed by Kotak Mahindra Capital, Morgan Stanley India, Jefferies India, and Motilal Oswal Investment Advisors.