IPO Synopsis
IPO Synopsis:
Sahajanand Med Tech has filed for an IPO with SEBI worth around Rs.1,500 crore. The IPO comprises of a fresh issue worth Rs.410.33 crore and an offer for sale of equity shares worth Rs.1,089.67 crore. The offer for sale consists of sale of shares worth Rs.100 crore by DhirajKumar S Vasoya, Shree Hari Trust is offloading shares worth Rs.33.75 crore and Rs.635.56 crore worth of shares is being offloaded by Samara Capital Markets Holding, NHPEA Sparkle Holding BV is offloading shares worth Rs.320.36 crore.
They are also considering a pre-IPO placement of around Rs.185 crore. The book running lead managers to this issue are Axis Capital Ltd, BofA Securities India Ltd, Edelweiss Financial Services and UBS Securities India Pvt Ltd.
Objectives of the issue:
1. Rs.255 crore is to be used to prepay and repay debt availed by the company
2. Rs.40.3 crore is to be used to fund the working capital requirements of the company’s indirect foreign subsidiary – Vascular Innovations Co Ltd
About Sahajanand Medical Technologies Ltd
Founded in 2001, Sahajanand Medical Tech are the leading medical devices company that engages in research, development, manufacturing and marketing of vascular devices, all over the globe. In FY21, they held the leading market share of 31% in the drug eluting stent market, in India. Sahajanand is among the top 5 companies in terms of market share in various countries like Germany, Netherlands, Poland and Italy, as of 31 March 2021. They distribute and sell their products to a total of 69 countries across the globe.
Their products are used in- Interventional cardiology, structural heart therapy and peripheral intervention. They have 3 research and development facilities located in Surat, Galway- Ireland and Nonthaburi- Thailand. Sahajanand Medical Technologies has been granted 67 patents globally, and there are 17 other patents in the pipeline along with 4 design registrations in India.
As of 31 March 2021, the company had 946 full time employees and 410 contract based employees, along with 24 consultants. Their sales team constitutes of 131 sales personnel spread across 37 branches all throughout the country. Key customers of Sahajanand Med Tech are Sterling AddLife India Pvt Ltd, Fortis Hospitals, Max Hospitals, Paras Hospitals etc.
Sahajanand Medical Technologies Ltd Financial Status
Financials:
|
Particulars (In Rs cr) |
FY21 |
FY20 |
FY19 |
|
Revenue |
588.52 |
479.9 |
326.11 |
|
PAT |
(72.38) |
25.43 |
33.43 |
|
EPS (In Rs) |
(8.13) |
2.69 |
3.67 |
|
Particulars (In Rs cr) |
FY21 |
FY20 |
FY19 |
|
Total Assets |
861.95 |
631.78 |
520.36 |
|
Total Borrowings |
325.10 |
87.21 |
69.64 |
|
Equity Share Capital |
8.89 |
8.89 |
8.89 |
Peer Comparison:
|
Particulars (In USD Mn) |
Medtronic |
Boston Scientific |
Abbott |
Edwards Life Science |
|
Revenue |
30,117 |
9,913 |
34,608 |
4,386 |
|
EBITDA |
8,236 |
1,723 |
8,618 |
1,431 |
|
EBITDA Margin |
27.35% |
17.38% |
24.90% |
32.63% |
|
ROE |
7.06 |
(0.56) |
13.93 |
18.88 |
|
Net Income Margin |
12% |
(0.83%) |
12.86% |
18.77% |
|
Debt to Equity |
53.29 |
62.73 |
60.67 |
15.19 |
The Key points are-
IPO Key Points
-
Strengths
Strengths:
1. The market that the company operates in, has high barriers to entry hence the competition is low, and they provide highly advanced products
2. Sahajanand Med Tech is the market leader in the interventional cardiology market in India and has a market share of 31% in FY21.
3. The company has direct operations in 10 countries and has distributor presence in 59 other countries
4. Highly experienced and skillful top management
-
Risks
1. The market that the company operates in, is highly regulated and this may hinder the approval needed for various products
2. There may be times when the company may not be able to implement their business strategies, and this will hinder their growth
3. The company’s business will be affected largely by foreign currency rate fluctuations
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-
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