Medi Assist Healthcare Services Ltd IPO - Key Details You Need to Know

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  • 12 Jan 2024
Medi Assist Healthcare Services Ltd IPO

Key Highlights

  • Medi Assist Healthcare Services Ltd is one of the India’s leading TPAs servicing insurance companies
  • The company’s IPO consists of OFS with a price issue of Rs 397-418
  • Listing will take place on January 22, 2024

If 2023 was a promising year for initial public offerings in India, 2024 seems to be no different. Several prominent companies are in the pipeline to cash in on investors’ renewed vigor in the Indian growth story. Medi Assist Healthcare Services Ltd is one of the several mainline companies looking to get listed on exchanges in January 2024 with its upcoming IPO. Here are its key details.

About the Company

Medi Assist Healthcare Services Limited offers third-party administration services to insurance companies through its wholly-owned subsidiaries. It has been in business for over two decades and has 97 offices in India. Its premium under management for H1 for FY 24 stands at a staggering over Rs 95 billion. The company has evolved as a PAN-India healthcare provider with 18,754 hospitals spread across 31 states in India and 141 countries worldwide.

IPO Details

Through its IPO, which opens on January 15, 2024, the company aims to raise Rs 1,171.58 crores, consisting of offer-for-sale by promoters and investors, who plan to sell 2.8 crore shares of the company. Some of the other vital details of the company’s IPO are as follows:

IPO opens on January 15, 2024
IPO ends onJanuary 17, 2024
Lot size35
Issue priceRs 397 - 418
Face valueRs 5
Listing onBSE, NSE
Listing dateJanuary 22, 2024
Issue sizeRs 1,171.58 crores

The primary aim of the issue is to complete the OFS and get the benefits of listing on stock exchanges. The company plans to enhance its visibility and brand image with the IPO.

Financial Snapshot

The company registered an 18.7% on-year growth, and its consolidated net profit stood at Rs 75.31 crores for the year ending March FY 23. Its revenue from operations grew by 28.2%, while EBITDA increased by 30.8% and stood at Rs 119.35 crores. Here are some of the other key financial details of the company for FY 23.

Total assets Rs 7,057.16 million
Total liabilitiesRs 3,220.44 million
Basic earnings per share10.94

Strengths and Risks

Given below are the key strengths of the company:

  • Well-established third-party administrator

The company is one of India’s premier third-party administrators. It enhances its ability to benefit from the growing prospects of India’s rising health industry, thus enhancing its profitability.

  • Scalable technology-enabled infrastructure

The company boasts of a scalable technology-enabled infrastructure, which is vital in addressing the constituents of the health insurance ecosystem. Following the COVID-19 pandemic, the significance of technology has become even more important among retail and group insurance providers.

  • Diversified base of group accounts

The company has a diversified base of corporates whose health insurance requirements it fulfills. It enjoys long-standing relationships with them. For FY 2023, the company has served more than 9500 group accounts, with the premiums managed for group accounts increasing at a CAGR of 37.08% between FY 21 and 23.

  • Risks

The associated risk factors are as follows:

  • Increasingly competitive TPA industry.
  • The company got 71% of its revenue from the top five clients in the six months ending on September 2023. If it loses any of these clients, the same could adversely affect its business. Changing rules and regulations coupled with legal uncertainties may adversely affect its business
  • Any decrease in outsourcing claims processing of insurance companies and other activities related to TPAs could affect its business

In Conclusion

Following the COVID-19 pandemic, there has been a rise in health insurance in India. With more and more people opting for health insurance in India, business prospects for TPAs are on the rise. Changing insurance dynamics led by modified consumer behaviors present an increasing need for TPAs to handle insurance claims. In such a scenario, Medi Assist Healthcare Services Ltd can see growth in their business in the coming days.

That said, just like investing in any IPO requires careful consideration and a keen evaluation of the company’s valuations, you must do the same for Medi Assist Healthcare Services Ltd. Review the company’s red herring prospectus for a detailed view and invest accordingly.

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