Healthium Medtech was established in 1992 as Sutures India Private Limited. Later on, it renamed itself Healthium Medtech limited. The company is engaged in the manufacturing and sales the wound closure products. The product portfolio of the company includes absorbable & non-absorbable sutures. The company is also involved in making mesh, skin staplers, medical consumables, surgical gloves, and tubular bandages. Checkout Healthium Medtech IPO date, price, size, and more details.
The company has a wide distribution network been expanded to 80 countries on different continents of the world. The company, on a consolidated basis, has six manufacturing facilities. In FY2013, Healthium Medtech concluded a JV in the SIAF-zone and MMM for manufacturing facility expansion in the Middle East. The company has carried out many strategic investments and acquisitions in the past. Healthium Medtech also acquired a full ownership stake in the Vital Group. It has helped them strengthen their presence in the urology sector in Europe and the US. Quinag Acquisition (FDI) Limited, backed by Apax Partners, acquired a full stake in Healthium Medtech from TPG Growth in June 2018. The company has four major revenue streams: Arthroscopy, wound care, urology, and innovative surgery in three major markets in India, the rest of the world, and the United Kingdom.
OBJECTS OF THE IPO ISSUE:
- Prepayment of all the company’s loans, which be availed on a consolidated basis.
- To meet corporate targets.
- To fund the working capital requirement.
BASIS OF THE HEALTHIUM MEDTECH IPO OFFER:
- Healthium Medtech is a top Medtech company. The company has a global footprint with an established position on the global level.
- The company will benefit from its reach to take advantage of dynamics in the industry, focusing on the high-growth regions.
- Healthium Medtech has a targeted R&D establishment with an innovative and highly comprehensive portfolio of its product line.
- The company has a proven track record with solution giving services, successful acquisition of other businesses.
- Healthium Medtech has a large sales network and a wide market reach in their target audience with a long association with their clients.
- The company has accreditation and is facilitated by certificates at the global level for their high-precision, scaled production and integrated manufacturing plants.
- Healthium Medtech has a well-proven track record of inorganic development with strong financial results.
HEALTHIUM MEDTECH IPO DETAILS:
Healthium Medtech Limited, a medical equipment manufacturer, has India headquarters in Mumbai. The company is recently waiting for approval from SEBI to float its IPO in the market. The company has already submitted its DRHP to the SEBI for verification. The company’s IPO will include an issue of fresh equity worth Rs. Three hundred ninety crores and an OFS been brought forward by the company of 39,100,000 equity shares.
Through the OFS, the following are expected to offload their stake in the company:
| Quinag Acquisition (FDI) | 39 million equity shares |
| Mahadevan Narayanamoni | 100,000 equity shares |
The company stated that the proceeds from the issue of the fresh equity will be used as:
| Repay Debt | Rs. 50.09 crores |
| Investment into its subsidiary operation | Rs. 179.46 crores |
| Strategic initiatives and Acquisition | Rs. 58 crores |
| IPO Opening Date | |
| IPO Closing Date | |
| Issue Type | Book Building Type |
| Face Value | Rs. 1/ Equity share |
| IPO Price | |
| Market Lot | |
| Min Order Quantity | |
| Listing At | BSE, NSE |
| Issue Size | |
| Fresh Issue | Rs. 390 crores |
| Offer for Sale | 39,100,000 equity shares |
| Basis of Allotment Date | |
| Initiation of Refunds | |
| The Credit of Shares to Demat Account | |
| IPO Listing Date | |
| Basis of Allotment Type | % Of the Allotment in the IPO Offer |
| Qualified Institutional Buyer | 50 |
| Non – Institutional Investor | 15 |
| Retail | 35 |
STRENGTH AND GROWTH ASPECTS OF HEALTHIUM MEDTECH IPO:
- Healthium Medtech registered strong financial and operational parameters and results in recent years.
- The company registered a healthy financial profile by revenue growth of around 11.7% in FY2021. It also registered an increase of 4% to 20.6% in Operating margins. It was marked due to its geographic diversification, which led to new clients with a high retention rate of the old clients.
- Healthium Medtech has carried out new launches focusing on an early-to-market strategy that helped them attain higher profitability even in the COVID-19 pandemic.
- The company registered an increase in its scale of operations and many successful cost-saving initiatives due to its backward-integrated business operations.
- Healthium Medtech is the largest manufacturer at the global level regarding the volume of surgical needles. It is also one of the leading manufacturers of surgical sutures worldwide, with the highest market share in India.
- A wide distribution network caters the service to 40,000 surgeons in 18,000 hospitals. It covers around 523 districts leading to the company’s PAN – India presence.
- The company has the excellent technical expertise, an R&D facility and a dedicated in-house team for development, design, sales and distribution. It enables the company to attain higher profitability, comfortable debt coverage metrics and robust capital structure.
- It is the largest company in the world engaged in manufacturing non-captive surgical needles. The market share of Healthium Medtech is 22.30 percent.
- Healthium Medtech is also the third-largest firm in the urology sector in the UK.
- Healthium Medtech has a highly diversified and robust product platform of 52,000 SKUs in various categories. It includes Surgical consumables, Urology equipment, Arthroscopy and wound care products.
- The company registered an increase in the demand for its product with an increased awareness due to the COVID-19, and the products have been used highly for the treatment. It led the company to attain a strong position in many Tiers 2-6 cities of India.
- The company’s revenue stream is well-positioned, with 33% from India, another 33% from the UK, and the rest of the revenue from other business engagement countries.
- The company has a strong business association with many top clients worldwide. These clients are on a long-term business agreement with the company.
- The company has very strong liquidity backed by its cash and liquid investments with a low external debt dependence.
WEAKNESS AND THREATS OF HEALTHIUM MEDTECH IPO:
- The company needs to comply with the changing laws, guidelines, rules and regulations. It also needs to comply with all the legal issues, tax laws. Any compliance with these guidelines will hurt the company’s operation.
- Healthium Medtech is vulnerable to maintaining its margins along with growth rates. The company also faces a challenge to replicate its past performance in the future.
- The company’s performance was affected by the COVID-19 epidemic. It resulted in the company’s operational and financial loss during this period.
- Healthium Medtech faces the pressure of Client pricing. It leads to a detrimental effect on its gross margin, ability to raise prices and profitability.
- The company has carried out many strategic investments and acquisitions, on a consolidated basis, the performance of these firms will affect the financial and operational parameters of the company.
- The scale of operations of the company is very moderate. Healthium Meditech’s business operation is also a very high working capital intensity requirement. The company holds a very high inventory days and receivables position on their books.
- Healthium Meditech stated that the company would carry out an Rs. 30-35 crore CAPEX in FY22 and FY23. Though it is planned to be funded by their internal accruals and cash available, if the CAPEX plan is funded finally through debt funds, the company’s financial results will be highly impacted.
- The company is also vulnerable to the availability, pricing, supply chain, and distribution of the raw materials required to produce their final goods.
- Since the majority of the company’s business revenue is derived from outside. As a result, Healthium Medtech is exposed to the risk of forex rates, tax, and other duties.
- The company faces stiff competition from many players in the market. The sector of its engagement is also very challenging.
FINANCIAL TRENDS OF HEALTHIUM MEDTECH IPO:
| PARAMETER | MARCH 21 | MARCH 20 | YoY % |
| Earnings Per Share (Rs) | 18.46 | 7.95 | 132.17 |
| CEPS(Rs) | 26.09 | 14.77 | 76.70 |
| Book NAV/Share (Rs) | 110.28 | 98.45 | 12.02 |
| Tax Rate (%) | 24.42 | 36.49 | -33.07 |
| Core EBITDA Margin (%) | 19.97 | 15.89 | 25.66 |
| EBIT Margin (%) | 17.18 | 10.50 | 63.61 |
| Pre-Tax Margin (%) | 15.85 | 9.06 | 74.98 |
| PAT Margin (%) | 11.98 | 5.75 | 108.23 |
| Cash Profit Margin (%) | 16.93 | 10.68 | 58.48 |
| ROA (%) | 11.72 | 5.48 | 113.95 |
| ROE (%) | 17.70 | 7.64 | 131.72 |
| ROCE (%) | 21.06 | 11.99 | 75.68 |
| Asset Turnover(x) | 0.98 | 0.95 | 2.75 |
| Sales/Fixed Asset(x) | 1.84 | 1.93 | -4.33 |
| Working Capital/Sales(x) | 2.56 | 3.36 | -23.95 |
| Fixed Capital/Sales(x) | 0.54 | 0.52 | 4.53 |
| Receivable days | 59.21 | 64.62 | -8.37 |
| Inventory Days | 64.98 | 73.07 | -11.08 |
| Payable days | 42.33 | 40.27 | 5.12 |
| EV/Net Sales(x) | -0.02 | 0.07 | -129.16 |
| EV/Core EBITDA(x) | -0.09 | 0.39 | -123.97 |
| EV/EBIT(x) | -0.12 | 0.67 | -117.82 |
| EV/CE(x) | -0.02 | 0.07 | -128.90 |
| Net Sales Growth (%) | 11.61 | 9.44 | 22.88 |
| Core EBITDA Growth (%) | 35.79 | 20.99 | 70.47 |
| EBIT Growth (%) | 82.60 | 114.32 | -27.75 |
| PAT Growth (%) | 132.39 | 164.40 | -19.47 |
| EPS Growth (%) | 132.17 | 164.40 | -19.61 |
| Total Debt/Equity(x) | 0.19 | 0.20 | -2.84 |
| Current Ratio(x) | 2.82 | 2.00 | 40.75 |
| Quick Ratio(x) | 1.98 | 1.34 | 47.53 |
| Interest Cover(x) | 12.91 | 7.28 | 77.40 |
| Particulars | For the year with amount ending in crores | ||||
| 31-Mar-21 | 31-Mar-20 | 31-Mar-19 | |||
| Total Assets | 791.78 | 710.31 | 683.34 | ||
| Total Revenue | 726.76 | 652.38 | 588.90 | ||
| Profit After Tax | 85.43 | 36.76 | 13.73 |
PROMOTERS:
Quinag Acquisition (FDI) Limited (“Quinag”) been backed by the Apax Partners
| Pre – Issue Share Holding | 99.79% |
| Post Issue Share Holding |
CONTACT DETAILS:
Healthium Medtech Limited
472/D, 4th Phase, 13th Cross,
Peenya Industrial Area,
Bengaluru 560058, Karnataka, India
Tel: +91 80 4186 8000
E-mail: cs@healthiummedtech.com
Website: www.healthiummedtech.com
REGISTRAR:
KFin Technologies Private Limited
Selenium, Tower B, Plot No- 31 and 32,
Financial District,
Nanakramguda, Serilingampally,
Hyderabad, Rangareedi 500 032,
Telangana, India
Tel: +91 40 6716 2222
E-mail: hml.ipo@kfintech.com
Website: www.kfintech.com
LEAD MANAGER(S) OF HEALTHIUM MEDTECH IPO:
- ICICI Securities Limited
- CLSA India Private Limited
- Nomura Financial Advisory and Securities (India) Private Limited
- Credit Suisse Securities (India) Private Limited
