GPT Healthcare Limited is one of the key regional corporate healthcare companies in Eastern India in terms of number of beds and hospitals as of Fiscal Year 2023. They operate a chain of mid-sized full service hospitals under the brand "ILS Hospitals" and provide integrated healthcare services, with a focus on secondary and tertiary care. Company offers a comprehensive range of healthcare services across over 35 specialties and super specialties, including internal medicine and diabetology, nephrology (including renal transplants), laparoscopic and general surgery, gynaecology and obstetrics, critical care, gastroenterology, orthopaedics and joint replacements, interventional cardiology, neurology, neurosurgery, paediatrics, and neonatology. Each of the hospitals also provides integrated diagnostic services and pharmacies that cater to the patients. Dr. Om Tantia has been the president of the Association of Minimal Access Surgeons of India and holds an honorary professorship bestowed by the Indian Medical Association and has been recognized as a 'Surgeon of Excellence in Metabolic and Bariatric Surgery' in the year 2016 by the Surgical Review Corporation, USA. Under his guidance, the first hospital of network was established in Salt Lake, Kolkata (West Bengal) in the year 2000 with a capacity of eight beds, which has grown to 85 beds, including 17 beds across various ICUs and HDUs as of September 30, 2023. The second hospital was set up in Agartala (Tripura) in the year 2011 and has a capacity of 205 beds as of September 30, 2023, including 66 beds across various ICUs and HDUs. The hospital in Dum Dum, Kolkata (West Bengal), established in the year 2013, has 155 beds, including 53 beds across various ICUs and HDUs as of September 30, 2023. It is authorized to perform renal transplants. The hospital in Howrah (West Bengal) was commissioned in the year 2019, with 116 beds including 43 beds across ICUs and HDUs as of September 30, 2023. They have 1,902 employees, 91 full-time consultants, and 481 visiting consultants as of September 30, 2023. As at September 30, 2023, the capital cost per bed was around Rs 5.41 million per bed (including land costs), which included two hospitals in a tier-I city, one hospital in a tier-II city and one in a tier-III city, compared to the industry average (excluding land costs) of above Rs 10.00 million per bed in tier-I cities, Rs 5.00 million to Rs 8.00 million per bed in tier-II cities and Rs 2.5 million to Rs 5.00 million per bed in tier-III cities, for tertiary care hospitals. In the Fiscal Years 2023, 2022, 2021, and for the six months ended September 30, 2023 and September 30, 2022, the four hospitals recorded ARPOB of Rs 29,671, Rs 29,253, Rs 24,681, Rs 32,979, and Rs 29,295 respectively. For the Fiscal Years 2023, 2022, and 2021 and for the six months ended September 30, 2023, September 30, 2022, they also recorded a bed occupancy rate of 58.92%, 56.36%, 48.00%, 59.92%, and 56.72%, respectively, and an ALOS of 4.22 days, 4.80 days, 5.56 days, 3.98 days and 4.17 days, respectively, on 196 an aggregate basis. The revenue is diversified across specialties, hospitals and the doctors. In the Fiscal Years 2023, 2022 and 2021 and the six months ended September 30, 2023, September 30, 2022, respectively, the total income mix was 18.42%, 25.20%, 29.66%, 17.34% and 17.68% from internal medicine and diabetology, 19.29%, 14.70%, 12.08%, 22.60% and 19.08% from nephrology, including renal transplants, 13.41%, 11.35%, 7.64%, 14.36% and 14.71% from laparoscopic and general surgery, 7.79%, 5.93%,5.20%, 6.91% and 7.78% from gynaecology and obstetrics, 7.47%, 5.45%, 5.19%, 6.90% and 8.32% from gastroenterology, 5.90%, 5.24%, 3.46%, 6.60% and 5.86% from orthopaedics and joint replacement, 5.75%, 5.54%, 4.44%, 4.08% and 5.77% from interventional cardiology and 21.97%, 26.59%, 32.33%, 21.21% and 20.80% from other specialties, respectively. As per financial performance, GPT Healthcare Limited has posted total income / net profits of Rs 248.86 Cr / Rs 21.09 Cr (FY21), Rs 342.40 Cr / Rs 41.66 Cr (FY22), Rs 366.73 Cr / Rs 39.00 Cr (FY23) and Rs 206.70 Cr / Rs 23.39 Cr (Q2 FY24). So as per previous financials data, company has shown growth, but decline in net-profit in FY23. Company has an average EPS of Rs 4.62 and average RoNW of 23.38% for last three fiscals. Issue is priced at a P/BV of 8.67 as per NAV of 21.45 as on 30.09.23. If we attribute latest earnings of FY22, FY23, TTM and annualised FY24 on fully diluted equity post issue, then asking price is at a P/E of around 36.63, 39.13, 33.54 and 32.49 respectively, which looks fully priced. As per RHP, comparison between listed peers is shown in above table. JM Financial Limited : This is 49th Main Board IPO from this BRLM. From last 10 Main Board IPOs, two opened below issue price and remaining opened above issue price on the day of listing. As of now, from last 10 Main Board IPOs, two are trading below issue price and remaining are trading above issue price.( As on 16.02.2024 ) As per financials, GPT Healthcare Limited has shown average growth, RoNW is 23.77% and P/E is respectively 36.63, 39.13, 33.54 and 32.49 as per FY22, FY23, TTM and annualised FY24 earnings. So, issue looks fully priced. Company is regional corporate healthcare companies in Eastern India. We may find other listed peers at similar valuations. So, we give NEUTRAL rating for this IPO. Readers must consult a qualified financial advisor prior to making any actual investment decisions.
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