Entero Healthcare Shares Dip on Debut; Lists at ₹1228 on NSE

16 Feb 2024 , 09:52 AM

Entero Healthcare Solutions, a distributor of healthcare products, faced a muted listing as its shares debuted at a discount of 2% on both the NSE and BSE. The shares were listed at ₹1228.70 on the NSE, reflecting a 2.33% decline from the issue price of ₹1258, while they opened at ₹1245 on the BSE, indicating a 1.03% discount.

Experts attribute the lackluster listing to several factors, including the tepid response to the initial public offering (IPO) and weak earnings performance in previous financial years. Despite turning profitable in the six-month period ending September FY24, the company’s historical performance, particularly in FY23, remained a concern for investors.

The ₹1,600-Crore public issue garnered tepid interest, with a subscription of just 1.53 times during the period from February 9 to 13, marking the lowest subscription numbers since the HMA Agro Industries IPO in June 2023. Qualified institutional buyers supported the issue, subscribing 2.28 times the allotted quota, while retail investors subscribed 1.33 times. However, non-institutional investors, particularly high net worth individuals, displayed less enthusiasm, subscribing to only 22% of the reserved portion.

Despite these challenges, Entero Healthcare Solutions demonstrated positive momentum in its financial performance. In the six months ended September FY24, the company achieved a net profit of ₹11.64 Crore, compared to a loss of ₹10.86 Crore in the corresponding period of the previous fiscal year. This turnaround was supported by robust operating numbers, with revenue from operations increasing by 19.7% to ₹1,895.5 Crore during the same period.

In FY23, the company posted a narrower loss of ₹11.1 Crore, down from ₹29.4 Crore in the previous fiscal year, while revenue from operations grew by 30.85% to ₹3,300 Crore. In FY21, the company reported a loss of ₹15.35 Crore on revenue of ₹1,779.7 Crore.