ABOUT COMPANY:
Krsnaa Diagnostics Ltd. (KDL is one of the largest differentiated diagnostic service providers in India (Source: CRISIL Report). It provides a range of technology-enabled diagnostic services such as imaging (including radiology), pathology/clinical laboratory and teleradiology services to public and private hospitals, medical colleges and community health centres Pan-India. It claims to be the fastest-growing diagnostic chain in India on multiple parameters including operating income, operating profit before depreciation, interest and tax ("OPBDIT") and profit after tax between Fiscal 2017 and Fiscal 2020 and volume of tests conducted between Fiscal 2018 and Fiscal 2021 (amongst players with revenues exceeding Rs. 150 cr.) (Source: CRISIL Report). According to CRISIL Report, KDL also operates one of India's largest teleradiology reporting hubs in Pune that is able to process large volumes of X-rays, CT scans and MRI scans round the clock and 365 days a year, and allows it to serve patients in remote locations where diagnostic facilities are limited.
FINANCIAL PERFORMANCE:
On the financial performance front, KDL has posted turnover/net profit (loss) of Rs. 214.32 cr. / Rs. - (58.06) cr. (FY19), Rs. 271.38 cr. / Rs. - (111.95) cr. (FY20) and Rs. 661.48 cr. / Rs. 184.93 cr. (FY21). Turnover and profits for FY21 include one-time gain from fair value movement of CCPS (Compulsory Convertible Preference Shares) amounting to Rs. 252.78 cr. According to seasoned players, this is an eyewash. If we ignore it, then KDL has posted a loss for even FY21.
For the last three fiscals, KDL has posted an average EPS of Rs. - (12.41) and an average RoNW of 9.54. The issue is priced at a P/BV of 11.19 based on its NAV of Rs. 85.27 and at a P/BV of 4.74 based on its post-issue NAV of Rs. 201.19 (at the upper price cap). Thanks to the collection of hefty premiums that helps the company showing a quantum reduction in the P/BV ratio.
Based on average negative earnings the issue has a negative P/E. Even if we attribute FY21 earnings (including onetime gains) on fully diluted post issue equity, then the asking price is at a P/E of 80.91, thus it is aggressively priced.
Krsnaa Diagnostics IPO Details
| IPO Opening Date | Aug 4, 2021 |
| IPO Closing Date | Aug 6, 2021 |
| Issue Type | Book Built Issue IPO |
| Face Value | ₹5 per equity share |
| IPO Price | ₹933 to ₹954 per equity share |
| Market Lot | 15 Shares |
| Min Order Quantity | 15 Shares |
| Listing At | BSE, NSE |
| Issue Size | [.] Eq Shares of ₹5 (aggregating up to ₹1,213.33 Cr) |
| Fresh Issue | [.] Eq Shares of ₹5 (aggregating up to ₹400.00 Cr) |
| Offer for Sale | 8,525,520 Eq Shares of ₹5 (aggregating up to ₹813.33 Cr) |
Krsnaa Diagnostics IPO Tentative Timetable
| IPO Open Date | Aug 4, 2021 |
| IPO Close Date | Aug 6, 2021 |
| Basis of Allotment Date | Aug 11, 2021 |
| Initiation of Refunds | Aug 12, 2021 |
| Credit of Shares to Demat Account | Aug 13, 2021 |
| IPO Listing Date | Aug 17, 2021 |
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