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Medi Assist IPO: 5 IMP Facts To Know Before You Invest

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It’s raining IPOs in India after some of the largest ones recently. Here’s another IPO you can check out. Medi Assist will kick off its IPO  on January 15, putting up 2.8 crore equity shares for sale, valued at ₹1,171.58 crore. The IPO closes on January 17. With this IPO, they aim to raise ₹ 1,200 crore, which will fund expansion plans and strengthen its capital base. 

Let’s examine their financial performance and what this IPO means for them and their stakeholders.

IPO Details

Offer Price₹397 to ₹418 per share
Face Value₹5 per share
Opening DateJanuary 15, 2024
Closing DateJanuary 17, 2024
Total Issue Size (In Shares)28,028,168 shares
Offer for Sale28,028,168 shares of ₹5
Total Issue Size (in ₹)₹1,171.58 Cr
Source: Chittorgarh

Investcorp Exits, Welcoming New Investors

Investcorp, a leading global private equity firm, has been a major shareholder in Medi Assist since 2015. With the company’s IPO, Investcorp wants to exit its investment by selling its entire stake. This exit will provide Investcorp with a healthy return on its investment, having bought its stake for ₹100 crore and now selling it for ₹537 crore. The sale also highlights the potential investors see in Medi Assist’s future.

Also Find: Upcoming IPOs

What does Investcorp’s Exit Mean?

Before the IPO, Investcorp held around 21.65% of the health-tech company, owning 1,49,10,452 equity shares. But they opted to sell 86,34,746 shares at ₹ 418 each, making ₹360.93 crore. This move happened just a couple of days before the IPO kicked off.

Now, the aftermath – Investcorp’s ownership in Medi Assist is down to 9.11%, which means they now hold 62,75,706 shares. Six investors bought the shares: SBI Life Insurance Company, Ashoka India Equity Investment Trust PLC, Volrado Venture Partners Fund -III-Beta, SBI General Insurance Company, and 360 One Special Opportunities Fund.

Medi Assist Growth Story

Medi Assist has carved a special place in the corporate healthcare sector, offering several health insurance plans for employees and their families. The focus on preventive care and extra services has appealed to corporate clients, helping their growth.

Over the past three years, their revenue has grown by more than 25% annually, thanks to solid customer acquisition and policy renewals. Profitability is keeping pace, too, with net profit increasing sevenfold during the same period. This solid financial performance has built confidence in investors, setting the stage for the upcoming IPO.

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Source: DRHP

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                                                               Source: DRHP

Let’s understand it better by a SWOT analysis:

STRENGTHSWEAKNESSES
Strong financial performance Dependence on the corporate segment
A diverse range of health insurance plans Prone to economic downturns.
Diverse range of health insurance plans Limited presence in the retail health insurance market.
Experienced management team Competition from established players 
OPPORTUNITIESTHREATS
Growing business prospectsRegulatory changes in the healthcare industry
Rising Awareness about preventive healthcareIncreased competition from other insurers
Expansion into the retail health insurance market.Economic slowdown impacting corporate spending 
Improved operational efficiency with technology

With the growing healthcare market, Medi Assist’s IPO is another option for investing in this sector. The company is in a strong position with good financial performance, a leading role in corporate health insurance, and an experienced management team. However, it’s essential to be aware of risks like relying too much on the corporate sector, having a limited presence in the retail market, and competition from big players. 

You must evaluate the strengths, weaknesses, opportunities, and threats before you decide. Due Diligence is crucial, and you must not skip it.  

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I’m Archana R. Chettiar, an experienced content creator with
an affinity for writing on personal finance and other financial content. I
love to write on equity investing, retirement, managing money, and more.

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