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Suraksha Diagnostic Ltd IPO
Status: Closed
Overview
IPO date
29 Nov 2024 to 03 Dec 2024
Face value
₹ 2 per share
Price
₹ 420 to ₹441 per share
Issue Size
19189330 shares
(aggregating up to ₹ 846.25 Cr)
(aggregating up to ₹ 846.25 Cr)
Allotment Date
04 Dec 2024
Listing at
NSE
Issue type
Book Building
Sector
Healthcare
Objectives of Suraksha Diagnostic Ltd IPO
Initial public offering of 19,189,330 equity shares of face value of Rs. 2 each of Suraksha Diagnostic Limited (the "Company" or the "Issuer") for cash at a price of Rs. 441 per equity share (including a premium of Rs. 439 per equity share) (the "Offer Price") aggregating to Rs. 846.25 crores through an offer for sale of 19,189,330 equity shares of face value of Rs. 2 each aggregating to Rs. 846.25 crores, comprising 2,132,148 equity shares of face value of Rs. 2 each aggregating to Rs. 94.03 crores by Somnath Chatterjee, 2,132,148 equity shares of face value of Rs. 2 each aggregating to Rs. 94.03 crores by Ritu Mittal, 2,132,148 equity shares of face value of Rs. 2 each aggregating to Rs. 94.03 crores by Satish Kumar Verma (whose shares are jointly held with Suman Verma) (together with Somnath Chatterjee and Ritu Mittal, the "Promoter Selling Shareholders"), 10,660,737 equity shares of face value of Rs. 2 each aggregating to Rs. 470.14 crores by Orbimed Asia ii Mauritius Limited^ (the "Investor Selling Shareholder"), 799,556 equity shares of face value of Rs. 2 each aggregating to Rs. 35.26 cores by Munna Lal Kejriwal, and 1,332,593 equity shares of face value of Rs. 2 each aggregating to Rs. 58.77 crores by Santosh Kumar Kejriwal (together the "Individual Selling Shareholders") (the promoter selling shareholders, the investor selling shareholder and the individual selling shareholders, collectively referred to as the "Selling Shareholders", and such equity shares offered by the selling shareholders, the "Offered Shares") (the "Offer" or the "Offer for Sale"). The offer constitutes 36.84% of the post-offer paid-up equity share capital of the company.
^ Surviving entity pursuant to amalgamation of orbimed Asia ii Mauritius fdi investments limited, the erstwhile shareholder, into orbimed asia ii mauritius limited on november 11, 2022
The face value of the equity shares is Rs. 2 each and the offer price is 220.5 times the face value of the equity shares.
Objectives of Suraksha Diagnostic Ltd IPO
Initial public offering of 19,189,330 equity shares of face value of Rs. 2 each of Suraksha Diagnostic Limited (the "Company" or the "Issuer") for cash at a price of Rs. 441 per equity share (including a premium of Rs. 439 per equity share) (the "Offer Price") aggregating to Rs. 846.25 crores through an offer for sale of 19,189,330 equity shares of face value of Rs. 2 each aggregating to Rs. 846.25 crores, comprising 2,132,148 equity shares of face value of Rs. 2 each aggregating to Rs. 94.03 crores by Somnath Chatterjee, 2,132,148 equity shares of face value of Rs. 2 each aggregating to Rs. 94.03 crores by Ritu Mittal, 2,132,148 equity shares of face value of Rs. 2 each aggregating to Rs. 94.03 crores by Satish Kumar Verma (whose shares are jointly held with Suman Verma) (together with Somnath Chatterjee and Ritu Mittal, the "Promoter Selling Shareholders"), 10,660,737 equity shares of face value of Rs. 2 each aggregating to Rs. 470.14 crores by Orbimed Asia ii Mauritius Limited^ (the "Investor Selling Shareholder"), 799,556 equity shares of face value of Rs. 2 each aggregating to Rs. 35.26 cores by Munna Lal Kejriwal, and 1,332,593 equity shares of face value of Rs. 2 each aggregating to Rs. 58.77 crores by Santosh Kumar Kejriwal (together the "Individual Selling Shareholders") (the promoter selling shareholders, the investor selling shareholder and the individual selling shareholders, collectively referred to as the "Selling Shareholders", and such equity shares offered by the selling shareholders, the "Offered Shares") (the "Offer" or the "Offer for Sale"). The offer constitutes 36.84% of the post-offer paid-up equity share capital of the company.
^ Surviving entity pursuant to amalgamation of orbimed Asia ii Mauritius fdi investments limited, the erstwhile shareholder, into orbimed asia ii mauritius limited on november 11, 2022
The face value of the equity shares is Rs. 2 each and the offer price is 220.5 times the face value of the equity shares.
Suraksha Diagnostic Ltd IPO Strategy
- Strengthen our position in our core geography i.e. Kolkata and the rest of West Bengal.
- Expand beyond our core markets in adjacent geographies of eastern and north-eastern India.
- Supplement organic growth with selective acquisitions.
- Leverage technology to elevate customer experience.
- Augmenting medical consultation services offered through polyclinic chambers at our diagnostic centres to boost our revenue.
- Enhance our revenue by inking business-to-business ("B2B") and corporate partnerships.
About Suraksha Diagnostic Ltd
Suraksha Diagnostic Limited was incorporated as Suraksha Diagnostic Private Limited' as a private limited company dated March 15, 2005, issued by the Deputy Registrar of Companies, West Bengal at Kolkata. Subsequently, Company was converted into a public limited company and the name of Company was changed to Suraksha Diagnostic Limited', and a fresh certificate of incorporation dated July 16, 2024, was issued by the Registrar of Companies, Central Processing Centre.
The Company is mainly engaged in running diagnostic centres for carrying out various pathological and radiological testing and medical consultation services in in East India. In addition to integrated pathology and radiology testing services, it also offer omnichannel medical consultation services via online and offline modes to customers through 43 of its diagnostic centres which house 120 polyclinic chambers hosting 750+ doctors. The diagnostic test menu included (a) 788 routine pathology tests ranging from basic biochemistry and
hematology to 647 specialized pathology tests such as advanced biochemistry, histopathology, and molecular pathology, and (b) 748 basic/intermediate radiology tests ranging from basic x-rays, ultrasonography (USG), and computerized tomography (CT) scans to 104 advanced radiology tests such as magnetic resonance imaging (MRI) scans and specialized CT scans.
The first centre of the Company was launched at Kestopur in 2007. The second centre launched at Khardah in 2010, which increased the operating centres to 5. The Company increased the laboratories to 4 and the operating centres rose to 25 in 2016. The Company further acquired the business of Sunwell Diagnostic Private Limited in 2017. The operations to Meghalaya were expanded through a public-private partnership with the Government of Meghalaya in 2019. Further, 2 pre-existing diagnostic centres in Kolkata were acquired by the Company from Future Medical and Research Trust in 2020. And the first 3T MRI and 128 CT launched at New Town in 2023.
The Company is planning the Public Issue upto 19,189,330 Equity Shares through Offer for Sale.
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Strengths vs Risks of Suraksha Diagnostic Ltd
Know the pros & cons
Strengths
Diagnostic chain with in eastern India well positioned to leverage growth opportunity for organized diagnostic chains in the diagnostic services markets in eastern and north-eastern India.- Track record of profitability and financial performance.
- Integrated diagnostics provider with one-stop solution offering pathology and radiology testing, and medical consultation services.
- Technologically advanced clinical infrastructure and trained personnel providing diagnostic services.
- Commitment to quality driving high individual consumer business share and customer retention.
- Management team with relevant industry experience.
Risks
- 95.48% of its Revenue from Operations in Fiscal 2024 was generated from West Bengal, and any loss of business in such region could have an adverse effect on its business, results of operations and financial condition.
- The securities of certain of its Promoter Group members have been suspended from trading on a recognized stock exchange in the past. The company cannot assure you that there will be no such instances in the future which may adversely affect its operations, reputation and ability to raise capital through further public issue of securities.
- The diagnostics industry in India is highly competitive and its inability to compete effectively from other healthcare service providers may adversely affect its business, results of operations and financial condition. Further, as of Financial Year 2024, the market share of the Company in its major market which is East India is 1.15-1.30%.
- The B2B segment contributed to 6.17% of its Revenue from Operations in Fiscal 2024 and any non-renewal or cancellation of its arrangements with its institutional customers, including hospitals, and Public-Private Partnership ("PPP") contracts may adversely affect its business, results of operations and financial condition.
- Its Statutory Auditors have included certain emphasis of matters, and audit qualifications matters prescribed in the audit reports of the Company for Fiscals 2023 and 2024.
- In the past, the company failed to comply with certain provisions of the Companies Act, 2013, and had to compound such non-compliances. The company cannot assure you that there will be no such non-compliances in the future and that the Company, Promoters, or Directors will not be subject to any penalty or additional payment.
- Certain of its Promoters, Directors, Subsidiaries and Group Company are in businesses similar to its and have interests in certain companies, which are in similar businesses to its, and this may result in potential conflict of interest with the company.
- Its Promoters and certain members of the company Promoter Group pledged some of the Equity Shares held by them in favour of Vistra ITCL (India) Limited, in its capacity as debenture trustee for the benefit of the debentureholders, as security for debentures issued by its Promoter Group entity, Tinni Investments Limited, and there are disposal restrictions created on Equity Shares held by certain other shareholders. Upon creation, any invocation of such pledge could dilute the aggregate shareholding of its Promoters, and such members of the company Promoter Group, which may cause a change in control of the Company and trigger an open offer requirement under the Takeover Regulations.
- There are outstanding legal proceedings involving the Company, Subsidiaries, Promoters, Directors and Group Companies which may adversely affect its business, financial condition and results of operations.
- The Company will not receive any proceeds from the Offer for Sale. The Selling Shareholders will receive the entire net proceeds from the Offer for Sale.
- Certain of its corporate records and filings are not traceable and may have inadvertent errors or inaccuracies.
- The company has in the past entered into related party transactions and may continue to do so in the future, which may potentially involve conflicts of interest with the equity shareholders.
- Its may become subject to various operational, reputational, medical and legal claims, regulatory actions or other liabilities arising from the provision of healthcare services and may be subject to liabilities arising from claims of malpractice and medical negligence which could adversely affect its business, results of operations and financial condition.
- The degree certificates of the educational qualifications of certain of its Promoters, Directors, Key Managerial Personnel and Senior Management Personnel are not traceable.
- Non-compliance with and changes in any of the applicable laws, rules or regulations, including pricing, safety, health and environmental laws, may adversely affect its business, results of operations and financial condition and cash flows.
- The company generated 93.83% of its revenue from operations for Fiscal 2024 from the B2C segment and its ability to attract individual patients is largely dependent on its brand recognition, reputation and brand image, any wrong diagnosis or treatment may induce negative publicity to its brand and reputation and could adversely impact its revenue from operations.
- Its credit rating in the past has been downgraded by CRISIL Ratings Limited. Any future downgrade of its credit rating by any credit rating agency could materially adversely affect its business and financial condition and the company ability to raise capital in the future.
- The company relies on its information technology systems and third-party platform for the operation of its business and any disruption to the company systems and/or third-party platform could adversely affect its business and reputation and result in litigation.
- The company significantly depends on third party vendors and suppliers to provide it the company testing equipment, test kits, and reagents, and any failures in procuring such equipment or recall of existing testing equipment, test kits, and reagents could adversely affect its business, results of operations and financial condition.
- Failures or malfunction of its equipment could adversely affect the company ability to conduct its operations.
- Any interruptions at its central reference laboratory and `hub' diagnostic centers may affect its ability to process diagnostic tests, which in turn may adversely affect its business, results of operations and financial condition.
- Its inability to effectively manage the company growth or to successfully implement its business plan and growth and expansion strategy could have an adverse effect on its business, results of operations and financial condition.
- If the company pursue strategic acquisitions, its may not be able to successfully consummate favourable transactions or successfully integrate acquired businesses.
- Employee misconduct or failures of its internal processes or procedures could harm the company by impairing its ability to attract and retain patients and subject it to significant legal liability and reputational harm.
- There have been certain instances of delays in payment of statutory dues by the Company in the past. Any delay in payment of statutory dues by the Company in the future may result in the imposition of penalties and in turn may have an adverse effect on the Company's business, financial condition, results of operation and cash flows.
- Any major outbreak of a health epidemic may affect its workforce and in turn affect the company's business, its financial condition, and the results of the company operations.
- Implementation of pricing policies by the Government or other authorities could adversely affect its business, results of operations and financial condition.
- Its business operations are being conducted on premises owned by and leased from third parties. Its inability to continue operating from such premises, or to seek renewal or extension of such leases may adversely affect its business and results of operations.
- The company does not own the brand name "Suraksha" which is registered in the name of Suraksha Diagnostic & Eye Centre Private Limited. While the company has entered into an assignment deed with Suraksha Diagnostic & Eye Centre Private Limited, however, the trademarks are yet to be registered in its name. In the event that the intellectual property rights to be assigned to it pursuant to the assignment deed are not registered in the company's name in a timely manner, its business and financial condition could be adversely affected.
- Any inadequacy or delay in collection and transportation of samples to its laboratories could compromise the integrity of such samples, which in turn could adversely affect its business, results of operations and financial condition.
- Failures to introduce new tests, services and technologies or acquires new orimproved equipment could adversely affect its business, results of operations and financial condition.
- The company generated 93.83% of its revenue from operations for Fiscal 2024 from the B2C segment and its ability to attract individual patients is largely dependent on its brand recognition, reputation and brand image, the disposable income of such patients and increasing general health awareness of India's general population, which could decline due to a variety of factors.
- The company operates 161 out of its 166 collection centers through franchisees. Any non-performance of the required specifications or parameters set by it by any of the franchisees may adversely affect its business, results of operations and financial condition.
- Its indebtedness and the conditions and restrictions imposed by the company financing agreements and any noncompliance thereof may lead to, among others, suspension of further drawdowns, which may adversely affect its business, results of operations and financial condition.
- If the company is unable to establish and maintain an effective internal controls and compliance system, over financial reporting, its reputation could be adversely affected.
- Its ability to pay dividends in the future will depends on the company earnings, financial condition, working capital requirements, capital expenditures and restrictive covenants of its financing arrangements.
- The company is subject to seasonal fluctuations in operating results and cash flows, which could affect its business, results of operations and financial condition.
- The company operates in east India, the East including Northeast region lags behind with 20-21% share in the diagnostic market (Source: CRISIL Report, as replicated on page 196).
- The company requires reagents to provide its services and any disruption in the supply of which may adversely affect its business, results of operations and financial condition and cash flows.
- Cyber threats and non-compliance with and changes in privacy laws and regulations may adversely affect its business, results of operations and financial condition and cash flows.
- Its may not be able to proceed with the Offer if the shareholding of certain of its Selling Shareholders does not fall below a certain threshold.
- The company has certain contingent liabilities that have not been provided for in its financial statements, which, if they materialise, may adversely affect its results of operations.
- The company is dependent on a number of key personnel, including its senior management and qualified and experienced laboratory professionals and doctors, and the loss of, or its inability to attract or retain such persons could adversely affect its business, results of operations and financial condition.
- Its Promoter and Promoter Group will continue to exert substantial voting control over the Company after completion of the Offer, which may limit your ability to influence the outcome of matters submitted for approval of its shareholders.
- Certain of its Promoter, members of Promoter Group, Directors and Key Managerial Personnel have interests in the Company in addition to their normal remuneration or benefits and reimbursement of expenses incurred.
- Its insurance coverage may not be sufficient or may not adequately protect the company against all material hazards, which may adversely affect its business, results of operations and financial condition.
- Certain information in this Red Herring Prospectus is based on its internal classification methodologies, which may change and which may or may not be consistent with companies operating in its industry, and hence the company cannot assure you of the completeness or the accuracy of such data.
- Its operations are labour intensive, and the company may be subject to strikes, work stoppages or increased wage demands by its employees, which could adversely affect the company's business, results of operations and financial condition.
- Its may be exposed to the risks due to the growth of diagnostic chains from standalone diagnostic centres.
- Certain sections of this Red Herring Prospectus disclose information from the CRISIL Report which has been prepared exclusively for the Offer and commissioned by and paid for by the Company exclusively in connection with the Offer, and any reliance on such information for making an investment decision in the Offer is subject to inherent risks.
- The key performance indicators included in this Red Herring Prospectus have been included based
on its understanding of the company's business and the industry and may not be an accurate indication of the company past or future performance.
- The financials of its Subsidiaries, including three Subsidiaries that have made a loss of Rs.10.70 million for Suraksha Salvia LLP, Rs.1.32 million for Asian Institute of Immunology and Rheumatology LLP and Rs.0.70 million for Suraksha Radiology Private Limited in Fiscal 2024, have been consolidated in the Restated Consolidated Financial Information and any adverse financial performance of its Subsidiaries will adversely impact the company's business, financial condition, results of operations and prospects.
Suraksha Diagnostic Ltd Peer Comparison
Understand the company’s industry standing
Suraksha Diagnostic Ltd
Dr Lal Pathlabs Ltd
Metropolis Healthcare Ltd
Face Value
2
10
2
Standalone / Consolidated
Consolidated
Consolidated
Consolidated
Total Income Rs. Cr.
222.26
2226.6
1207.709
EPS-Basis
4.43
43.05
24.95
EPS-Diluted
4.43
42.98
24.87
NAV Per Share
33.66
221.53
213.98
P/E-Basic EPS
---
77.08
89.61
P/E-Diluted EPS
---
---
---
RONW(%)
14.09
20.35
12.26
Latest NAV Period
---
---
---
Latest NAV
---
---
---
How to check the allotment status of Suraksha Diagnostic Ltd IPO?
Follow the steps
Open link to the registrar using this URL (https://evault.kfintech.com/ipostatus/).
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The IPO opens on 29 Nov 2024 & closes on 03 Dec 2024.
Suraksha Diagnostic Limited was incorporated as Suraksha Diagnostic Private Limited' as a private limited company dated March 15, 2005, issued by the Deputy Registrar of Companies, West Bengal at Kolkata. Subsequently, Company was converted into a public limited company and the name of Company was changed to Suraksha Diagnostic Limited', and a fresh certificate of incorporation dated July 16, 2024, was issued by the Registrar of Companies, Central Processing Centre.
The Company is mainly engaged in running diagnostic centres for carrying out various pathological and radiological testing and medical consultation services in in East India. In addition to integrated pathology and radiology testing services, it also offer omnichannel medical consultation services via online and offline modes to customers through 43 of its diagnostic centres which house 120 polyclinic chambers hosting 750+ doctors. The diagnostic test menu included (a) 788 routine pathology tests ranging from basic biochemistry and
hematology to 647 specialized pathology tests such as advanced biochemistry, histopathology, and molecular pathology, and (b) 748 basic/intermediate radiology tests ranging from basic x-rays, ultrasonography (USG), and computerized tomography (CT) scans to 104 advanced radiology tests such as magnetic resonance imaging (MRI) scans and specialized CT scans.
The first centre of the Company was launched at Kestopur in 2007. The second centre launched at Khardah in 2010, which increased the operating centres to 5. The Company increased the laboratories to 4 and the operating centres rose to 25 in 2016. The Company further acquired the business of Sunwell Diagnostic Private Limited in 2017. The operations to Meghalaya were expanded through a public-private partnership with the Government of Meghalaya in 2019. Further, 2 pre-existing diagnostic centres in Kolkata were acquired by the Company from Future Medical and Research Trust in 2020. And the first 3T MRI and 128 CT launched at New Town in 2023.
The Company is planning the Public Issue upto 19,189,330 Equity Shares through Offer for Sale.
Suraksha Diagnostic Ltd IPO will close on 03 Dec 2024.
- Diagnostic chain with in eastern India well positioned to leverage growth opportunity for organized diagnostic chains in the diagnostic services markets in eastern and north-eastern India.
- Track record of profitability and financial performance.
- Integrated diagnostics provider with one-stop solution offering pathology and radiology testing, and medical consultation services.
- Technologically advanced clinical infrastructure and trained personnel providing diagnostic services.
- Commitment to quality driving high individual consumer business share and customer retention.
- Management team with relevant industry experience.
| S.No | Promoters Name | Pre Issue Shares | Pre Issue Percentage | Post Issue Shares | Post Issue Percentage |
|---|---|---|---|---|---|
| 1 | Somnath Chatterjee | 4731836 | 9.09 | 2599688 | 4.99 |
| 2 | Ritu Mittal | 10408455 | 19.99 | 8276307 | 15.89 |
| 3 | Satish Kumar Verma | 7776119 | 14.93 | 5643971 | 10.84 |
| 4 | Tinni Investment Ltd | 2407000 | 4.62 | 2407000 | 4.62 |
| 5 | Dneema Overseas Pvt Ltd | 1669562 | 3.21 | 1669562 | 3.21 |
| 6 | Sarla Kejriwal | 4809062 | 9.23 | 4809062 | 9.23 |
- 95.48% of its Revenue from Operations in Fiscal 2024 was generated from West Bengal, and any loss of business in such region could have an adverse effect on its business, results of operations and financial condition.
- The securities of certain of its Promoter Group members have been suspended from trading on a recognized stock exchange in the past. The company cannot assure you that there will be no such instances in the future which may adversely affect its operations, reputation and ability to raise capital through further public issue of securities.
- The diagnostics industry in India is highly competitive and its inability to compete effectively from other healthcare service providers may adversely affect its business, results of operations and financial condition. Further, as of Financial Year 2024, the market share of the Company in its major market which is East India is 1.15-1.30%.
- The B2B segment contributed to 6.17% of its Revenue from Operations in Fiscal 2024 and any non-renewal or cancellation of its arrangements with its institutional customers, including hospitals, and Public-Private Partnership ("PPP") contracts may adversely affect its business, results of operations and financial condition.
- Its Statutory Auditors have included certain emphasis of matters, and audit qualifications matters prescribed in the audit reports of the Company for Fiscals 2023 and 2024.
- In the past, the company failed to comply with certain provisions of the Companies Act, 2013, and had to compound such non-compliances. The company cannot assure you that there will be no such non-compliances in the future and that the Company, Promoters, or Directors will not be subject to any penalty or additional payment.
- Certain of its Promoters, Directors, Subsidiaries and Group Company are in businesses similar to its and have interests in certain companies, which are in similar businesses to its, and this may result in potential conflict of interest with the company.
- Its Promoters and certain members of the company Promoter Group pledged some of the Equity Shares held by them in favour of Vistra ITCL (India) Limited, in its capacity as debenture trustee for the benefit of the debentureholders, as security for debentures issued by its Promoter Group entity, Tinni Investments Limited, and there are disposal restrictions created on Equity Shares held by certain other shareholders. Upon creation, any invocation of such pledge could dilute the aggregate shareholding of its Promoters, and such members of the company Promoter Group, which may cause a change in control of the Company and trigger an open offer requirement under the Takeover Regulations.
- There are outstanding legal proceedings involving the Company, Subsidiaries, Promoters, Directors and Group Companies which may adversely affect its business, financial condition and results of operations.
- The Company will not receive any proceeds from the Offer for Sale. The Selling Shareholders will receive the entire net proceeds from the Offer for Sale.
- Certain of its corporate records and filings are not traceable and may have inadvertent errors or inaccuracies.
- The company has in the past entered into related party transactions and may continue to do so in the future, which may potentially involve conflicts of interest with the equity shareholders.
- Its may become subject to various operational, reputational, medical and legal claims, regulatory actions or other liabilities arising from the provision of healthcare services and may be subject to liabilities arising from claims of malpractice and medical negligence which could adversely affect its business, results of operations and financial condition.
- The degree certificates of the educational qualifications of certain of its Promoters, Directors, Key Managerial Personnel and Senior Management Personnel are not traceable.
- Non-compliance with and changes in any of the applicable laws, rules or regulations, including pricing, safety, health and environmental laws, may adversely affect its business, results of operations and financial condition and cash flows.
- The company generated 93.83% of its revenue from operations for Fiscal 2024 from the B2C segment and its ability to attract individual patients is largely dependent on its brand recognition, reputation and brand image, any wrong diagnosis or treatment may induce negative publicity to its brand and reputation and could adversely impact its revenue from operations.
- Its credit rating in the past has been downgraded by CRISIL Ratings Limited. Any future downgrade of its credit rating by any credit rating agency could materially adversely affect its business and financial condition and the company ability to raise capital in the future.
- The company relies on its information technology systems and third-party platform for the operation of its business and any disruption to the company systems and/or third-party platform could adversely affect its business and reputation and result in litigation.
- The company significantly depends on third party vendors and suppliers to provide it the company testing equipment, test kits, and reagents, and any failures in procuring such equipment or recall of existing testing equipment, test kits, and reagents could adversely affect its business, results of operations and financial condition.
- Failures or malfunction of its equipment could adversely affect the company ability to conduct its operations.
- Any interruptions at its central reference laboratory and `hub' diagnostic centers may affect its ability to process diagnostic tests, which in turn may adversely affect its business, results of operations and financial condition.
- Its inability to effectively manage the company growth or to successfully implement its business plan and growth and expansion strategy could have an adverse effect on its business, results of operations and financial condition.
- If the company pursue strategic acquisitions, its may not be able to successfully consummate favourable transactions or successfully integrate acquired businesses.
- Employee misconduct or failures of its internal processes or procedures could harm the company by impairing its ability to attract and retain patients and subject it to significant legal liability and reputational harm.
- There have been certain instances of delays in payment of statutory dues by the Company in the past. Any delay in payment of statutory dues by the Company in the future may result in the imposition of penalties and in turn may have an adverse effect on the Company's business, financial condition, results of operation and cash flows.
- Any major outbreak of a health epidemic may affect its workforce and in turn affect the company's business, its financial condition, and the results of the company operations.
- Implementation of pricing policies by the Government or other authorities could adversely affect its business, results of operations and financial condition.
- Its business operations are being conducted on premises owned by and leased from third parties. Its inability to continue operating from such premises, or to seek renewal or extension of such leases may adversely affect its business and results of operations.
- The company does not own the brand name "Suraksha" which is registered in the name of Suraksha Diagnostic & Eye Centre Private Limited. While the company has entered into an assignment deed with Suraksha Diagnostic & Eye Centre Private Limited, however, the trademarks are yet to be registered in its name. In the event that the intellectual property rights to be assigned to it pursuant to the assignment deed are not registered in the company's name in a timely manner, its business and financial condition could be adversely affected.
- Any inadequacy or delay in collection and transportation of samples to its laboratories could compromise the integrity of such samples, which in turn could adversely affect its business, results of operations and financial condition.
- Failures to introduce new tests, services and technologies or acquires new orimproved equipment could adversely affect its business, results of operations and financial condition.
- The company generated 93.83% of its revenue from operations for Fiscal 2024 from the B2C segment and its ability to attract individual patients is largely dependent on its brand recognition, reputation and brand image, the disposable income of such patients and increasing general health awareness of India's general population, which could decline due to a variety of factors.
- The company operates 161 out of its 166 collection centers through franchisees. Any non-performance of the required specifications or parameters set by it by any of the franchisees may adversely affect its business, results of operations and financial condition.
- Its indebtedness and the conditions and restrictions imposed by the company financing agreements and any noncompliance thereof may lead to, among others, suspension of further drawdowns, which may adversely affect its business, results of operations and financial condition.
- If the company is unable to establish and maintain an effective internal controls and compliance system, over financial reporting, its reputation could be adversely affected.
- Its ability to pay dividends in the future will depends on the company earnings, financial condition, working capital requirements, capital expenditures and restrictive covenants of its financing arrangements.
- The company is subject to seasonal fluctuations in operating results and cash flows, which could affect its business, results of operations and financial condition.
- The company operates in east India, the East including Northeast region lags behind with 20-21% share in the diagnostic market (Source: CRISIL Report, as replicated on page 196).
- The company requires reagents to provide its services and any disruption in the supply of which may adversely affect its business, results of operations and financial condition and cash flows.
- Cyber threats and non-compliance with and changes in privacy laws and regulations may adversely affect its business, results of operations and financial condition and cash flows.
- Its may not be able to proceed with the Offer if the shareholding of certain of its Selling Shareholders does not fall below a certain threshold.
- The company has certain contingent liabilities that have not been provided for in its financial statements, which, if they materialise, may adversely affect its results of operations.
- The company is dependent on a number of key personnel, including its senior management and qualified and experienced laboratory professionals and doctors, and the loss of, or its inability to attract or retain such persons could adversely affect its business, results of operations and financial condition.
- Its Promoter and Promoter Group will continue to exert substantial voting control over the Company after completion of the Offer, which may limit your ability to influence the outcome of matters submitted for approval of its shareholders.
- Certain of its Promoter, members of Promoter Group, Directors and Key Managerial Personnel have interests in the Company in addition to their normal remuneration or benefits and reimbursement of expenses incurred.
- Its insurance coverage may not be sufficient or may not adequately protect the company against all material hazards, which may adversely affect its business, results of operations and financial condition.
- Certain information in this Red Herring Prospectus is based on its internal classification methodologies, which may change and which may or may not be consistent with companies operating in its industry, and hence the company cannot assure you of the completeness or the accuracy of such data.
- Its operations are labour intensive, and the company may be subject to strikes, work stoppages or increased wage demands by its employees, which could adversely affect the company's business, results of operations and financial condition.
- Its may be exposed to the risks due to the growth of diagnostic chains from standalone diagnostic centres.
- Certain sections of this Red Herring Prospectus disclose information from the CRISIL Report which has been prepared exclusively for the Offer and commissioned by and paid for by the Company exclusively in connection with the Offer, and any reliance on such information for making an investment decision in the Offer is subject to inherent risks.
- The key performance indicators included in this Red Herring Prospectus have been included based on its understanding of the company's business and the industry and may not be an accurate indication of the company past or future performance.
- The financials of its Subsidiaries, including three Subsidiaries that have made a loss of Rs.10.70 million for Suraksha Salvia LLP, Rs.1.32 million for Asian Institute of Immunology and Rheumatology LLP and Rs.0.70 million for Suraksha Radiology Private Limited in Fiscal 2024, have been consolidated in the Restated Consolidated Financial Information and any adverse financial performance of its Subsidiaries will adversely impact the company's business, financial condition, results of operations and prospects.
The Issue type of Suraksha Diagnostic Ltd is Book Building.
The minimum application for shares of Suraksha Diagnostic Ltd is 34.
The total shares issue of Suraksha Diagnostic Ltd is 19189330.
Initial public offering of 19,189,330 equity shares of face value of Rs. 2 each of Suraksha Diagnostic Limited (the "Company" or the "Issuer") for cash at a price of Rs. 441 per equity share (including a premium of Rs. 439 per equity share) (the "Offer Price") aggregating to Rs. 846.25 crores through an offer for sale of 19,189,330 equity shares of face value of Rs. 2 each aggregating to Rs. 846.25 crores, comprising 2,132,148 equity shares of face value of Rs. 2 each aggregating to Rs. 94.03 crores by Somnath Chatterjee, 2,132,148 equity shares of face value of Rs. 2 each aggregating to Rs. 94.03 crores by Ritu Mittal, 2,132,148 equity shares of face value of Rs. 2 each aggregating to Rs. 94.03 crores by Satish Kumar Verma (whose shares are jointly held with Suman Verma) (together with Somnath Chatterjee and Ritu Mittal, the "Promoter Selling Shareholders"), 10,660,737 equity shares of face value of Rs. 2 each aggregating to Rs. 470.14 crores by Orbimed Asia ii Mauritius Limited^ (the "Investor Selling Shareholder"), 799,556 equity shares of face value of Rs. 2 each aggregating to Rs. 35.26 cores by Munna Lal Kejriwal, and 1,332,593 equity shares of face value of Rs. 2 each aggregating to Rs. 58.77 crores by Santosh Kumar Kejriwal (together the "Individual Selling Shareholders") (the promoter selling shareholders, the investor selling shareholder and the individual selling shareholders, collectively referred to as the "Selling Shareholders", and such equity shares offered by the selling shareholders, the "Offered Shares") (the "Offer" or the "Offer for Sale"). The offer constitutes 36.84% of the post-offer paid-up equity share capital of the company.
^ Surviving entity pursuant to amalgamation of orbimed Asia ii Mauritius fdi investments limited, the erstwhile shareholder, into orbimed asia ii mauritius limited on november 11, 2022
The face value of the equity shares is Rs. 2 each and the offer price is 220.5 times the face value of the equity shares.