Can you tell me about the proposed IPO of Yatharth Hospital?

Yatharth Hospital & Trauma Care Services Ltd is a company that is into professional operation and management of health care facilities on an outsourced service model basis. The company has already filed its draft red herring prospectus or DRHP with SEBI for its proposed IPO of Rs.610 crore plus OFS. The overall public issue will comprise of a fresh issue worth Rs.610 crore with an additional offer for sale (OFS) of 65.51 lakh shares.

The selling of shares in the OFS will be entirely done by the promoter entities. The OFS will not be capital dilutive or EPS dilutive. However, the OFS will lead to expansion of the public shareholding and reduction of promoter holding, which will increase the floating stock of the company. Yatharth is also planning a pre-IPO placement worth Rs.122 crore, and if successful, the final IPO size would be reduced by an equivalent amount.

Yatharth predominantly operates and manages private hospitals in the Delhi-NCR region. It will use issue the fresh proceeds of the IPO to the tune of Rs.610 crore (net of issue and other expenses) to reduce debt of the parent company and its subsidiary company. In addition, it will also use the fund to partially bankroll its expansion plan. The outsourced hospital model is emerging as the in-thing in healthcare business.