Medplus Health Services Limited IPO

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i. Incorporated in 2006 Medplus is the second-largest pharmacy retailer in India, in terms of
(a) revenue from operations for the financial year 2021
(b) number of stores as of March 31, 2021, according to the Technopak Report

ii. Company offers a wide range of products, including
(a) pharmaceutical and wellness products, including medicines, vitamins, medical devices and test kits, and
(b) fast-moving consumer goods, such as home and personal care products, including toiletries, baby care products, soaps and detergents, and sanitizers.

iii. The company has a vast network of 2000+ stores distributed across Tamil Nadu, Andhra Pradesh, Telangana, Karnataka, Odisha, West Bengal, and Maharashtra.

iv. They are the first pharmacy retailer in India to offer an omnichannel platform, its customers could either visit its stores or access its offerings online, through its website and mobile application.

Competitive Strengths
India’s Second Largest Pharmacy retailer
Established Brand and Value Proposition to Customers
Successful Track Record of Expansion

Objects of the Medplus Health Services Limited IPO:

The Offer comprises of the Fresh Issue (600 Crores) and the Offer for Sale (798.3 Crores). The Company proposes to utilise the Net Proceeds towards funding of the following objects: 1. Funding working capital requirements of the Material Subsidiary, Optival 2. General corporate purposes.

Medplus Health Services Limited IPO Details:

Open Date: Dec 13 2021
Close Date: Dec 15 2021
Total Shares: 1,75,66,582
Face Value: ₹ 2 Per Equity Share
Issue Type: Book Built
Issue Size: 1,398.3 Cr.
Lot Size: 18 Shares
Issue Price: ₹ 780 -796 Per Equity Share
Listing At: NSE,BSE
Listing Date: Dec 23 2021

Promoters And Management:

i. Gangadi Madhukar Reddy, is the Managing Director and Chief Executive Officer of the Company. He is one of the Promoters of the Company and has been a Director of the Company since incorporation on November 30, 2006. He holds a bachelor’s degree in medicine and surgery from the Sri Venkateswara University and a master’s degree in business administration from the Wharton School, University of Pennsylvania. In 2015, he was awarded the “Business Person of the Year – Large Scale” at the Sakshi Excellence Awards by Sakshi Media Group. ii. Anish Kumar Saraf, is a Non-Executive Director of the Company. He is a chartered accountant with the Institute of Chartered Accountants of India. He holds a post-graduate diploma in management from the Indian Institute of Management, Ahmedabad. He is the managing director of Warburg Pincus India Private Limited and has been in the employment of the company for 15 years. iii. Atul Gupta, is a Non-Executive Director of the Company. He holds a bachelor’s degree in technology from the Indian Institute of Technology, Bombay and a master’s degree in business administration from the Walter A. Haas School of Business, University of California, Berkeley. He is employed as an investment partner at Prazim Trading and Investment Company Private Limited. He has over 13 years of experience in the investment industry.

Financials of Medplus Health Services Limited IPO:

Particulars (in Millions) 2020-21 2019-20
Revenue 30,693 28,706
Cost of goods sold 25,213 25,806
Cost of materials consumed 82 38
Increase in inventories -1,054 -2,479
Employee benefits expense 3,386 2,724
Net loss on fair value changes 322
Other Expense 897 956
Operating profit 2,167 1,336.78
OPM % 7% 5%
Other Income 215 172
Finance Cost 548 467
Depriciation 882 748
Profit Before tax 950 293
Profit After Tax 640 -5.36
EPS 30 1.05
Total Outstanding Shares before IPO = 111,761,165 New Shares to be issued in IPO = 75,37,688 Total Shares Outstanding after IPO = 119,298,853 PAT (FY21) = 64 Crores EPS(FY21) = 5.33 P/E = 796/5.33 = 150x

Comparison With Peers:

There are no listed companies in India that comparable in all aspects of business and services of Medplus.

Recommendation on Medplus Health Services Limited IPO:

Review and Recommendation of Medplus by InvestorZone is 4/10 1. It is the second largest Retail Pharmacy chain in India after Apollo. They also sell medicines via Online Channel. 2. Medplus is a having lean Cost Structure and technology driven Operations. 3. Medplus has well qualified, experienced and entrepreneurial board and senior management team. 4. This is the first IPO of Retail Pharmacy Chain, so difficult to comment on valuation. 5. Mcap at which IPO is coming = 9400 Crores. Sales of FY21 = 3100 Crores. Mcap/Sales = 3x (Looks Fairly Priced)

Registrar of Medplus Health Services Limited IPO:

  1. Kfin Technology Private Limited

Company Address:

Medplus Health Services Limited 707, 7th Floor, 5-9-13, Taramandal Commercial Complex, Saifabad Hyderabad 500 004 Phone: +91 040 6724 6724 Email: Website

Discussion on Medplus Health Services Limited IPO:


    Valuation of MedPlus

    Total Outstanding Shares = 11.11 Crores…

    IPO Price = 796 per share

    Mcap = 8835 Crores….

    PAT (FY21) = 64 Crores
    EPS (FY21) = 64/11.11= 5.76

    P/E = 796/5.76 = 138x…

    Looks a good company growth wise…. They have a chain of Pharmacies in India….90% business comes from offline and 10% business comes from online retail….

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