The Suraksha Diagnostic Limited IPO is set to hit the markets, creating buzz among investors. This ₹846.25 crore book-built issue offers a unique opportunity to invest in a growing diagnostics company. But is it worth your time and money? Let’s dive into the details.
IPO Overview
The Suraksha Diagnostic IPO is entirely an offer for sale (OFS) of 1.92 crore shares by the promoters and other selling shareholders. This means the company itself will not receive any proceeds from the IPO.
Suraksha Diagnostic IPO Key details
| Particulars | Details |
| Issue Size | ₹846.25 crore |
| IPO Dates | November 29 to December 3, 2024 |
| Price Band | ₹420 to ₹441 per share |
| Lot Size | 34 shares |
| Minimum Investment (Retail) | ₹14,994 |
| Listing Date | December 6, 2024 |
| Listing At | BSE, NSE |
Why should you care about this IPO?
Established Presence in Diagnostic Services
Suraksha Diagnostic Limited has been providing comprehensive pathology and radiology services since 2005. With a focus on the Eastern and Northeastern regions of India, its hub-and-spoke model ensures seamless operations and quicker turnaround times.
Operational Network at a Glance
- 1 central reference laboratory
- 8 satellite laboratories
- 49 diagnostic centres
- 166 sample collection centres
The company recently performed 1.58 million diagnostic tests in just three months, catering to 280,000 patients.
Financial Performance
Suraksha Diagnostic has shown a promising financial track record, with significant growth in both revenue and profit.
| Financial Year | Revenue (₹ Cr) | PAT (₹ Cr) | Assets (₹ Cr) |
| FY 2024 (till June) | 61.85 | 7.67 | 314.2 |
| FY 2023 | 193.69 | 6.07 | 281.2 |
| FY 2022 | 225.77 | 20.82 | 275.96 |
Growth highlights:
- Revenue increased by 14.75% between FY 2023 and FY 2024.
- Profit after tax (PAT) surged by an impressive 281.32% during the same period.
Key financial ratios:
| Metric | Value |
| Return on Equity (ROE) | 14.09% |
| Debt-to-Equity Ratio | 0.2 |
| PAT Margin (%) | 10.57% |
IPO timeline and key dates
Mark your calendars for these important dates:
| Event | Date |
| IPO Opens | November 29, 2024 |
| IPO Closes | December 3, 2024 |
| Basis of Allotment | December 4, 2024 |
| Refund Initiation | December 5, 2024 |
| Shares Credited to Demat | December 5, 2024 |
| Listing Date | December 6, 2024 |
IPO Investment Insights
Here’s how the allocation is structured:
| Category | Shares Reserved | Allocation (%) |
| Retail Investors (RII) | 67,16,266 | 35% |
| Non-Institutional Investors (NII) | 28,78,400 | 15% |
| Qualified Institutional Buyers (QIB) | 38,37,867 | 20% |
| Anchor Investors | 57,56,797 | 30% |
For retail investors, the minimum lot size of 34 shares requires an investment of ₹14,994, while the maximum for retail is 13 lots (₹194,922).
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What sets Suraksha Diagnostic Apart?
Competitive Strengths
- Integrated Services: Offers pathology, radiology, and medical consultancy under one roof.
- Technological Advancements: Systems like Laboratory Information Management System (LIMS) and Radiology Information System (RIS) improve efficiency.
- Strong Regional Focus: 95.34% of revenue comes from its primary regions like Kolkata and West Bengal.
- Scalable Operations: Hub-and-spoke model ensures streamlined logistics and cost-efficiency.
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Peer Comparison
Suraksha Diagnostic competes with some major players in the diagnostics industry:
| Company | P/E Ratio |
| Dr. Lal PathLabs | 77.08 |
| Metropolis Healthcare | 89.61 |
| Thyrocare | 65.52 |
| Vijaya Diagnostic | 86.4 |
While Suraksha Diagnostic’s post-issue P/E ratio of 99.31 is higher than its peers, its focus on underserved markets and technological edge could justify the premium in the long run.
Should you invest?
Here’s a summary of the pros and cons:
| Pros | Cons |
| Strong financial growth | Higher valuation compared to peers |
| Well-established infrastructure | Regional dependency for revenue |
| Advanced technology and streamlined operations | Competitive industry |
For long-term investors, the company’s growth potential in Eastern India and its technological adoption make it a compelling option. However, short-term investors may want to approach with caution due to its valuation.
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Conclusion
The Suraksha Diagnostic Limited IPO offers an opportunity to invest in a growing diagnostics chain with a strong foothold in Eastern India. Its financial growth, operational scalability, and technological integration position it as a promising player in the diagnostics sector.
Whether this IPO aligns with your investment strategy depends on your risk appetite and time horizon. For those looking at long-term growth in a niche market, Suraksha Diagnostic could be a worthwhile addition to your portfolio.
