Entero Healthcare IPO received tepid investors response on day 2 so far

12 Feb 2024 , 01:58 PM

Entero Healthcare Solutions’ initial public offering (IPO) is facing a lukewarm response from investors, with only 17% of the offer size being subscribed to on the second day of bidding. The bidding process will conclude on Tuesday, February 13, with investors having purchased 11.84 lakh equity shares out of the total 71.5 lakh shares on offer. Click here to subscribe the IPO.

Retail investors have shown relatively more interest, subscribing to approximately 76% of the shares allocated for them, while non-institutional investors have only taken up about 7% of their quota. Qualified institutional investors are yet to participate in the offering.

Employees, who have a reservation of ₹8 Crore worth of shares, have subscribed to 65% of the shares in their allocated quota. The Haryana-based healthcare products distributor is offering its shares in the price range of ₹1,195-1,258 per share, with a minimum bid requirement of 11 shares per lot.

Entero Healthcare aims to raise ₹1,000 Crore through the fresh issue component and ₹600 Crore via an offer-for-sale (OFS) route. Prominent shareholders such as Prabhat Agrawal, Prem Sethi, Orbimed Asia Iii Mauritius, Chethan MP, and Deepesh T Gala will be offloading shares under the OFS.

Proceeds from the fresh issue will be utilized for debt repayment, working capital needs, inorganic growth through acquisitions, and general corporate purposes. The company received approval for its public offer from the capital market regulator in November last year.

ICICI Securities Ltd, DAM Capital Advisors Ltd, Jefferies India Private Ltd, JM Financial Ltd, and SBI Capital Markets Ltd are serving as book-running lead managers to the offer. IPO allotment is scheduled for February 14, with shares expected to be credited to eligible investors’ demat accounts by February 15. Trading in the company’s equity shares is anticipated to commence on the BSE and NSE from February 16.

Founded in 2018 by Prabhat Agarwal and Prem Sethi, Entero Healthcare Solutions claims to be one of the top three healthcare product distributors in India by revenue in FY22. The company has demonstrated profitability in the six months ended September FY24, with net profits of ₹11.64 Crore compared to a loss of ₹10.86 Crore in the corresponding period of the previous fiscal. Additionally, its revenue from operations during the same period increased by 19.7% to ₹1,895.5 Crore. In FY23, Entero Healthcare recorded a narrowed loss of ₹11.1 Crore compared to ₹29.4 Crore in the previous year, with revenue from operations growing to ₹3,300 Crore during the same period.