About the Company:
Medplus Health Services Ltd is the second largest pharmacy retailer in India, in terms of revenue from operations and number of stores for the financial year 2021.
Company offers a wide range of products, including pharmaceutical and wellness products, including medicines, vitamins, medical devices and test kits, and fast-moving consumer goods, such as home and personal care products, including toiletries, baby care products, soaps and detergents, and sanitizers.
Currently company is India’s second largest pharmacy retail network of over 2,000 stores distributed across Tamil Nadu, Andhra Pradesh, Telangana, Karnataka, Odisha, West Bengal and Maharashtra,
Company’s share of the organized pharmacy retail market, based on revenue from operations, in Chennai, Bangalore, Hyderabad and Kolkata stood at approximately 30%, 29%, 30% and 22%, respectively.
Company’s History:
Company was founded in 2006 by Gangadi Madhukar Reddy, company’s Managing Director and Chief Executive Officer, with the vision to set up a trusted pharmacy retail brand that offers genuine medicines and delivers better value to the customer by reducing inefficiencies in the supply chain using technology.
Scaling up the store network.
Company has maintained a strong focus on scaling up the store network, having grown from operating initial 48 stores in Hyderabad at the conception of the business to operating India’s second largest pharmacy retail network of over 2,000 stores distributed across Tamil Nadu, Andhra Pradesh, Telangana, Karnataka, Odisha, West Bengal and Maharashtra, as of March 31, 2021.
Company’s Stores in various states:
Company’s number of stores has grown since the conception of the business and, as of September 30, 2021, company operated 546 stores in Karnataka, 475 stores in Tamil Nadu, 474 stores in Telangana, 297 stores in Andhra Pradesh, 224 stores in West Bengal, 221 stores in Maharashtra and 89 stores in Odisha.
Company’s Store count in various states:
Average revenue per store:
Company’s average revenue per store was approximately Rs.1.59 crores, as compared to the average revenue per store in the domestic pharmacy retail industry of approximately Rs.23 Lakhs.
Company’s Warehouse:
Company has primary warehouse, in each of Bangalore, Chennai, Hyderabad, Vijayawada, Kolkata, Pune, Bhubaneshwar, Mumbai and Nagpur.
These warehouses are supported by smaller warehouses in cities where company has higher store density. These technologically enabled warehouses form hubs for our stores, and stores’ inventories are replenished through centralized inventory management system.
Company’s Manufacturing Facilities and Capacity.
Company has three manufacturing plants in Telangana, located at Jeedimetla, Moosapet and Pashamylaram.
At Jeedimetla plant company manufactures a range of plastic products including medicine trays, nebulisers, vaporisers, plastic bottles and caps, and other plastic products.
Company manufactures optical frames and spectacles at Moosapet plant and liquid disinfectants, toiletries and cosmetics at Pashamylara plant.
Competitors for the Company:
Company compete with pharmacy retailers that operate omni-channel platforms, offline-only retail chains or online-only retail platforms.
Such competitors include Apollo Pharmacy, Wellness Forever, Frank Ross Pharmacy, Noble Plus Pharmacy & Skin Care, Tata 1mg, NetMeds, and PharmEasy.
Competitor’s Store Count:
Top 5 Players in the Business (Revenue wise):
Management Team:
- Mr. Gangadi Madhukar Reddy (Designation: Managing Director and Chief Executive Officer)
- Mr. Anish Kumar Saraf (Designation: Non-Executive Director)
Objectives of the Issue:
Offer for Sale: (Rs. 798 cr)
- The proceeds of the Offer for Sale shall be received by the Selling Shareholders. Company will not receive any proceeds from the Offer for Sale.
Fresh Issue: (Rs. 600 cr)
- Investment into our Material Subsidiary, Optival for funding working capital requirements of Optival.
- General corporate purposes.
Peer Group Comparison:
There are no listed companies in India that comparable in all aspects of business and services that MedPlus Health Services ltd provide. Hence, it is not possible to provide an industry comparison in relation to our Company.
Positives for the Company:
India’s Second Largest Pharmacy retailer.
- Company is the second largest pharmacy retailer in India, in terms of revenue from operations and number of stores for the financial year 2021.
- For the financial year 2021, company’s total revenue from operations represented approximately 15% share of the organized pharmacy retail market in India.
Established Brand and Value Proposition to Customers.
- Company’s “MedPlus” brand has a history and track record of over 15 years, and has become a well-established brand that is positioned to stand for genuine and good quality pharmaceutical products that are offered at affordable prices.
Continuous expansion in no. of Stores.
- Company has continued to expand the store footprint in key cities where company operates.
- Between March 31, 2010 and September 30, 2021, the number of stores in Chennai grew almost five-fold from 62 to 304 stores, number of stores in Bangalore grew three-fold from 110 to 340 stores, number of stores in Hyderabad grew over two-fold from 141 to 331 stores, and number of stores in Kolkata grew over ten-fold from 22 to 224 stores.
- In terms of number of stores as of March 31, 2021, company ranked 1st in Chennai and Bangalore, and 2nd in Hyderabad and Kolkata.
Started deliveries for online purchases.
- Company is now delivering customers’ online purchases within two hours of purchase in select cities of Hyderabad, Bangalore, Chennai, Kolkata, Pune and Nagpur.
- These services were started in the financial year 2021, and recent pilots conducted in July, 2021, have showed promising results where 93% of online delivery purchases were delivered within two hours in select micro-markets of Hyderabad.
- company expects to expand the ability to deliver online purchases within two hours of purchase in cities such as Mumbai by December 31, 2021.
Cost efficient procurement.
- Due to the huge scale of operations, company has developed strong relationships with suppliers over a period of time, which has enabled company to procure products at more favourable rates than the competitors.
- As the majority of the product procurement is conducted directly from pharmaceutical companies or their carry forward agents, company is also more efficient with the procurement processes and are better able to manage replacement of damage goods or the risk of pilferage.
Financials of the Company:
| (in Crores) | FY 19 | FY 20 | FY 21 | 30th Sept 2021 |
|---|---|---|---|---|
| Revenue | 2284.9 | 2887.8 | 3090.8 | 1890.8 |
| Net Profit | 11.9 | 1.7 | 63.1 | 66.3 |
IPO Details:
| Details | Info |
|---|---|
| Issue Opens on | 13th December 2021 |
| Issue Closes on:. | 15th December 2021 |
| Issue Price | Rs.780 – 796 |
| Face Value | Rs.2 |
| Retail Category Allocation | 35% |
| Minimum Lot | 18 Shares |
| Minimum Investment | Rs.14,328 |
| Issue Constitutes | 14.72% |
| Issue Size | Rs.1398 cr ($ 186 million) |
| Market Cap | Rs.9496 cr ($ 1.26 billion) |
| Listing at | NSE & BSE |
| Equity Shares Offered (Fresh) | 75,37,689 (Rs. 600 cr) |
| Equity Shares Offered (OFS) | 1,00,28,769 (Rs. 798 cr) |
| Equity Shares Offered (Fresh + OFS) | 1,75,66,458 (Rs. 1398 cr) |
| Equity Shares Prior to the Issue | 11,17,61,165 |
| Equity Shares after the issue | 11,92,98,854 |
Also Read : List of Upcoming IPO’s in India.
Important Dates:
| Finalization of Basis of Allotment | on or Before 20th December 2021 |
| Initiation of Refunds | on or Before 21st December 2021 |
| Credit of Equity Shares: | on or Before 22nd December 2021 |
| Listing Date: | on or Before 23rd December 2021 |
Subscription Details: (Will be Updated)
| (Subscription-Category-Wise (no. of times) Till time : 06:00 PM) | Shares Offered | Day-1 | Day-2 | Day-3 |
|---|---|---|---|---|
| QIB | 35,72,550 | 0.06 | 0.09 | 114.19 |
| NII | 26,79,414 | 0.16 | 0.51 | 87.08 |
| Retail | 62,51,965 | 1.29 | 2.68 | 5.34 |
| Employee | 71,225 | 0.78 | 1.77 | 3.12 |
| TOTAL | 1,25,75,154 | 0.70 | 1.48 | 53.67 |
Note: Retail Subscription on the basis of Applications: 4.81x
IPO Valuation Parameters:
| Earnings Per Share (EPS) | Price To Earnings ratio (PE) | Return on Net Worth (RoNW) | Net Asset Value (NAV) |
|---|---|---|---|
| 5.75 | 138.43 | 8.74% | 65.37 |
| Check IPO Allotment Status: |
|---|
KfinTech Website: http://kfintech/IPO/Allotment_StatusBSE IPO Website: https://www.bseindia.com/IPO/Allotment |
| Company Contact Info: |
|---|
| MedPlus Health Services Limited 707, 7th Floor, 5-9-13 Taramandal Commercial Complex Saifabad, Hyderabad 500 004 Telangana, India. Tel: +91 040 6724 6724; E-mail: cs@medplusindia.com Website: www.medplusindia.com |
| IPO Registrar Info: |
|---|
| KFin Technologies Private Limited Selenium, Tower B, Plot No- 31 and 32, Financial District, Nanakramguda, Serilingampally, Hyderabad, Rangareedi 500 032, Telangana, India Tel: +91 40 6716 2222/ 180034 54001 E-mail: medplus.ipo@kfintech.com Website: www.kfintech.com |
