Sangani Hospitals Limited IPO - Review, Valuation, Dividend & GMP

Sangani Hospitals Limited - Complete Overview

Established in 2001, Sangani Group is a healthcare organization founded by Dr. Ajaykumar Sangani, with the primary aim of providing quality healthcare services to the community.

Subsequently, Dr Rajeshkumar Sangani, the younger brother of Dr Ajaykumar Sangani, and Dr Vaishali Sangani, the wife of Dr Rajeshkumar Sangani, joined the hospital with the shared objective of further enhancing the quality of healthcare services provided.

Operating in the Keshod and Veraval regions of Gujarat, the group is a multi-speciality healthcare provider with a combined bed capacity of 68 beds.

The hospital offers a wide range of services, including MD-ICU, ICCU, ECHO-TMT, Dialysis, Orthopaedic Department, PFT, EECP, Diabetic Clinic, ENT- EAR, NOSE, Throat Head & Neck Surgery, Laser Surgery, Trauma Unit, Endoscopy, Audiology, Vertigo Clinic,

OBST & Gynee-USG-Doppler, Normal Delivery, Joint Replacement Facility, Gynec Surgery, Infertility Clinic, Radiology Unit - Xray, Sonography, CT Scan, General Surgery, all types of general surgery, Dental Surgery, and Uro Surgery, among other hospital services.

Additionally, the Sangani Group operates two pathology laboratories and two medical stores in Keshod and Veraval, catering to the diagnostic and medical needs of patients, offering a seamless healthcare experience.

Notably, the hospital is also a part of Ayushman Bharat, a flagship scheme of the Government of India.

 

 

What does the company do?

Sangani Hospitals Limited, a healthcare organization, offers quality healthcare services to the community in the Keshod and Veraval regions of Gujarat.

 

IPO Overview

The IPO dates for Sangani Hospitals Limited are from August 4 to August 8, 2023. The issue price of the shares is set at Rs. 37 to Rs. 40 per share, with a face value of Rs. 10 per share.

The IPO is expected to be listed on NSE SME on August 17, 2023. The total issue size of the IPO is 3,792,000 shares, amounting to Rs. 15.17 Crores.

Out of the total issue, the company has reserved 45% for retail investors, 45% for non-institutional investors, and 10% for institutional investors.

One lot of shares consists of 3000 shares, priced at Rs. 120,000. Retail investors are allowed to bid for a maximum of 1 lot only.

 

Sangani Hospitals Limited IPO timetable 

EVENTS	DATE
IPO Opening Date	4 August 2023
IPO Closing Date	8 August 2023
IPO Allotment Date	11 August 2023
Refund initiation	14 August 2023
IPO Listing Date	17 August 2023

 

Sangani Hospitals Limited IPO Details

IPO Opening & Closing Date	4 August to 8 August 2023
Face Value	Rs. 10 per share
Issue Price	Rs. 37 to Rs. 40 per share
Lot Size	3000 Shares
Price of 1 Lot	Rs. 120,000
Issue Size	3,792,000 shares (aggregating up to Rs. 15.17 Cr)
Offer for Sale	NA
Fresh Issue	3,792,000 shares (aggregating up to Rs. 15.17 Cr)
Listing at	NSE SME
Issue Type	Book Built Issue IPO
Registrar	Bigshare Services Pvt. Ltd.

 

Sangani Hospitals Limited IPO Lot Details

Minimum Lot Investment (Retail)	1 Lot
Maximum Lot Investment (Retail)	1 Lot
Minimum Lot Investment (HNI)	2 Lot

 

Sangani Hospitals Limited IPO Reservation

Institution Portion	10%
Non-Institution Portion	45%
Retail Portion	45%

 

Company Financial

Amount in Lakhs

Period	FY 21	FY 22	FY 23
Total Assets	299.20	705.45	1932.15
Total Revenue	498.21	420.63	869.08
PAT	79.06	105.35	100.36
Net Worth	168.79	501.60	1748.96
Reserve & Surplus	--	106.78	750.46
Total Borrowings	--	34.57	--

 

Revenue Contribution of Both of the Hospitals

Particular	Revenue contribution (Rs. in Lakhs) 31 March 2021	Revenue contribution (Rs. in Lakhs) 31 March 2022	Revenue contribution (Rs. in Lakhs) 31 December 2022
Sangani Hospital, Keshod	206.69	312.99	373.88
Sangani Super Speciality Hospital, Veraval	89.86	240.81	221.07

 

Key operational and financial metrics of Sangani Hospitals Limited

Particular	31 March 2021	31 March 2022	31 December 2022
Revenue from operations (Rs.in lakhs)	497.29	1,028.32	867.87
EBIDTA (Rs.in lakhs)	119.86	306.07	217.96
PBT (Rs.in lakhs)	105.65	294.48	138.89
PAT (Rs.in lakhs)	79.06	219.41	100.36
RoCE	55.71%	55.20%	7.94%

 

Objective of the Issue

The company aims to raise funds to fulfil following objectives:

• Expansion of Sangani Hospital at Keshod, Gujarat through capital expenditure.
• Expansion of Sangani Super Speciality Hospital at Veraval, Gujarat through capital expenditure.
• To fulfil General corporate purposes.

 

Promoters and Management of Sangani Hospitals Limited

The company's key promoters include Dr Ajaykumar Sangani, Dr Rajeshkumar Sangani, Kamalkumar Sangani, and Dr Vaishali Sangani. Their contributions have been instrumental in paving a successful journey for the company.

Pre-issue Promoters Holding	99.60%
Post-issue Promoters Holding	NA

 

Peer Comparison

Company Name	Revenue from operations (Rs. in Lakhs)	Diluted EPS (Rs.)	P/E
Sangani Hospital Limited	1,028.32	5.56
Artemis Medicare Services Limited	55,480.12	2.29	33.49
Lotus Eye Hospital And Institute Ltd	3,890.99	1.44	48.47

 

IPO's Valuations

The upcoming IPO of Sangani Hospitals is scheduled to be listed on NSE SME, with a price range of Rs.37 to Rs.40 per share. The company's EPS stands at Rs.5.56 per share, and although the PE ratio is not specified in the DRHP, we can calculate it to be approximately 7 based on the provided data. Compared to its peers, this PE ratio is relatively low, suggesting that the company's shares may be undervalued.

 

Dividend Policy

In the past, the company has not implemented any formal dividend policy. However, it may consider providing dividends to its shareholders in the future, subject to the company's financial performance and other prospects.

 

IPO's Strengths

• Doctor-led hospitals rely on skilled and experienced doctors within the healthcare industry.
• The hospital specifically focuses on serving under-served areas with high population densities.
• The hospitals see growth potential in expanding their existing facilities and venturing into new services.
• These establishments have the capability to attract high-quality doctors, nurses, paramedical professionals, and other staff.

 

IPO Weaknesses

• A significant portion of the company's revenue is currently generated from two hospitals: Sangani Hospital, Keshod, and Sangani Super Speciality Hospital, Veraval.
• Due to the company's limited operating history, investors may find it challenging to assess prospects based on historical results.
• The company's revenue heavily relies on inpatient treatments.
• The company is exposed to medical and legal risks related to operating medical facilities and in-house pharmacies, which includes potential adverse publicity.
• Competition from other hospitals and healthcare facilities is a factor to consider.
• The lack of health insurance coverage in India may impact the company's business.
• The company is involved in certain legal proceedings.
• The Promoters and Directors of the company have interests in an entity with businesses similar to the company.
• The company needs to obtain and renew various registrations, licenses, approvals, NoCs, and permits as part of its regular business operations.
• Past non-compliance with certain regulatory filings with the RoC may lead to discrepancies in certain statutory filings and corporate records of the Company.

 

 

IPO GMP Today

As on 08th Aug, 2023 GMP of Sangani Hospitals Ltd IPO is Rs. 4.

 

Conclusion

The IPO of Sangani Hospitals Limited offers a promising investment opportunity in the healthcare sector. The company has demonstrated a strong revenue track record in the past, indicating its financial stability. Moreover, the hospital's planned expansion is expected to bolster its profitability further.

However, it is essential for investors to consider the Grey Market performance of the share before arriving at any conclusions. Evaluating all relevant factors is crucial for making a well-informed investment decision that can lead to optimal outcomes. 

 

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To Read the Prospectus of the Company Click Here to Download the RHP

 

 

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