Can you tell me about the Medplus IPO that is opening next week for subscription?

The IPO of Medplus Health Services will open next week on Monday 13-December. Incidentally, Medplus is the second largest pharmacy retail chain in India in terms of the network of stores and top line revenues. Under the Medplus banner, the retailer sells wellness products, kits, sanitary products apart from medicines. It has a total network of 2165 outlets across the states of TN, Andhra Pradesh, Telangana, Karnataka and others.

The IPO of Medplus Health Services will open on 13-December and close on 15-December. While the basis of allotment will be finalized on 20-December the stock would be listed on the bourses on 23-December. The total IPO size is Rs.1,398 crore comprising of a fresh issue of Rs.600 crore and an OFS of Rs.798.30 crore. The price band for the IPO has been fixed in the range of Rs.780 to Rs.796.

The Medplus IPO has a 50% allocation for QIBs and 35% to retail. Retail investors can apply for 13 lots (with each lot comprising of 18 shares) with an upper investment limit of Rs.186,264 in the current IPO. Once the IPO is completed, the combination of the OFS and the fresh will ensure that the promoter stake in the company comes down from 43.16% to 40.43%. Public holding will go up accordingly.

Medplus is a consistent profit maker and had reported revenues of Rs.3,091 crore for FY21. It also made a net profit of Rs.63.11 crore in FY21. The pharmacy retail business generally has a very lot net margin and operates more on volumes. In this case, the NPM is just 2.04%. Medplus will use the fresh funds for financing the working capital needs of its subsidiary, Optival.