| Price | Lot Size | Issue Date | Issue Size |
|---|---|---|---|
| ₹ 420 to ₹ 441 | 34 | 29th Nov, 2024 – 03rd Dec, 2024 | ₹ 846.25 Cr |
About Suraksha Diagnostic Ltd IPO
Suraksha Diagnostic offers a comprehensive pathology and radiology testing solution, coupled with medical consultation services, operating through an extensive network with a central reference laboratory and eight satellite laboratories. As of June 30, 2024, the company boasted 215 customer touchpoints, including 49 diagnostic centres and 166 sample collection centres across West Bengal, Bihar, Assam, and Meghalaya. Their central reference laboratory has received accreditation from the College of American Pathologists, while three other laboratories have earned NABL accreditations, and three advanced diagnostic centres hold NABH accreditations. Additionally, 44 diagnostic centres feature 126 polyclinic chambers, facilitating consultations with over 750 specialized doctors. During FY24, the company conducted ~5.98 million tests serving ~1.14 million patients and derived 95.5% of revenue from operations from core geography, Kolkata and the rest of West Bengal. The company’s radiology equipment consists of 24 CT and 13 MRI machines. Their operational network comprises 13 hub centres equipped to handle all pathology sample collections and basic and advanced radiology tests, alongside 11 medium centres, 23 small centres, and two centres operated under public-private partnerships, which focus on pathology sample collection and specific basic radiology tests. This network is further supported by 166 sample collection centres and a central reference laboratory. The company also offered a comprehensive range of 2,300+ tests covering various specialties and disciplines. Its diagnostic test menu included 788 routine pathology tests ranging from basic biochemistry and haematology to 664 specialized pathology tests such as advanced biochemistry, histopathology, and molecular pathology. The company provides 766 basic/intermediate tests in radiology, ranging from essential X-rays and ultrasonography to 119 advanced tests, including MRI and specialized CT scans, as of June 30, 2024.
Objective of the Suraksha Diagnostic Ltd IPO
The net proceeds from the fresh issue will be used towards the following purposes:
- The issue is completely offer for sale;
- General corporate purposes.
Rationale To Invest In Suraksha Diagnostic Ltd IPO
Diagnostic chain in eastern India is well positioned to leverage growth opportunities
The company is well-established diagnostic chain in eastern India, is primed to capitalize on regional growth opportunities. The company reported a robust CAGR of 20.9% in non-COVID revenues between FY22 and FY24. The company has built an extensive operational network across West Bengal, Bihar, Assam, and Meghalaya states. As of June 30, 2024, 44 of its diagnostic centres also house polyclinic chambers hosting specialized doctors, enhancing patient convenience. With a market share of 1.15% to 1.30% in eastern India as of FY24, Suraksha Diagnostic trails behind competitors like Dr. Lal Pathlabs Limited, which holds a 5.3% to 5.7% share in north India, and Vijaya Diagnostic Centre Limited, which captures 2.2% to 2.5% in south India. However, this indicates significant growth potential for Suraksha Diagnostic in its core geography. The company also believes its strong market position, built through a longstanding operational history, wide network, and reputation for providing quality diagnostic services, positions it well for sustained growth. Suraksha Diagnostic aims to expand its business in Kolkata and the broader eastern and north-eastern Indian markets, leveraging the favorable conditions for organized diagnostic chains in these rapidly growing regions. With a commitment to maintaining high standards of care and service, the company is well-placed to seize the opportunities ahead and solidify its presence in the diagnostic services market.
Technologically advanced clinical infrastructure and trained personnel providing diagnostic services
Suraksha Diagnostic believes they have been at the forefront of diagnostics technology, with a Strong technical capability and ability to adapt to the latest technologies in the diagnostic industry, ensuring that patients benefit from the latest technologies and receive high-quality and reliable diagnostic services. The company’s flagship central reference laboratory, located in New Town, Kolkata, spread over 40,000 square feet, houses a fully automated AI-enabled robotic track and liquid chromatography with tandem mass spectroscopy, cytogenetics, and next-generation sequencing capabilities. They utilize digital pathology and AI for blood tests, with all radiology reporting done on a digital platform, significantly reducing turnaround times. They underscore their commitment to quality with MRI capabilities ranging from 1.5T to 3T and offering up to 128-slice CT scans. The company also believes that due to continuous investment and long-standing relationships with certain medical technology vendors. Suraksha Diagnostic has been at the forefront of introducing new tests by adopting the latest medical technologies across the operational network. The company diagnostic centre operations are aided by the technology platforms and systems used to streamline, such as Laboratory Information Management System (LIMS), fully integrated Radiology Information Systems (RIS) – Picture Archive and Communication Systems (PACS) and Enterprise Resource Planning (ERP) system. These enable the company to streamline operations, reduce the margin of error, allow cross-locational functioning, and efficiently utilize resources.
Valuation of Suraksha Diagnostic Ltd IPO
Suraksha Diagnostic offers a comprehensive solution for pathology and radiology testing solution and medical consultation services, operating through an extensive network with a central reference laboratory and eight satellite laboratories. The company provides comprehensive and high-quality diagnostic services in India through the operational network consisting of a flagship central reference laboratory, satellite laboratories and customer touchpoints, including diagnostic and sample collection centres. Some of the company’s centres also house polyclinics hosting specialized doctors for patient convenience. Suraksha Diagnostic has implemented a cluster-based ‘hub and spoke’ model, whereby samples are collected from multiple locations within a cluster for delivery to laboratories for diagnostic testing. The company also focuses on a customer-centric approach to delivering our services, leading to high customer satisfaction and increasing customer retention. On the financial front, the company has delivered a Revenue CAGR growth of 20.9% between FY2022-24. As of FY24, Suraksha garnered a market share of ~1.15%-1.30% in its core eastern India market and aims to expand its presence in the northeastern markets further. The company provides pathology and radiology testing services, with revenue primarily concentrated in West Bengal. Its financial performance has been inconsistent, with a setback in FY23, but it has recently shown signs of recovery. At the upper price band of Rs 441, Suraksha Diagnostic is valued at FY24 P/E multiple of 96.1x, which is highly valued compared to its peers. Therefore, we currently recommend an AVOID rating for the issue and will reassess our rating in future following sustained business performance in upcoming quarters.
What is the Suraksha Diagnostic Ltd IPO?
Suraksha Diagnostic IPO is a book built issue of Rs 846.25 crores. The issue is entirely an offer for sale of 1.92 crore shares. Suraksha Diagnostic IPO opens for subscription on November 29, 2024 and closes on December 3, 2024. The allotment for the Suraksha Diagnostic IPO is expected to be finalized on Wednesday, December 4, 2024. Suraksha Diagnostic IPO will list on BSE, NSE with tentative listing date fixed as Friday, December 6, 2024. Login to your account now.
How to apply for the Suraksha Diagnostic Ltd IPO through StoxBox?
To apply for the Suraksha Diagnostic Ltd. IPO through StoxBox one can apply from the website and also from the app. Click here
When will the Suraksha Diagnostic Ltd IPO open?
Suraksha Diagnostic Ltd IPO is opening on 29th November 2024. Apply Now
What is the lot size of the Suraksha Diagnostic Ltd IPO?
The Lot Size of Suraksha Diagnostic Ltd IPO is 34 equity shares. Login to your account now
When is the Suraksha Diagnostic Ltd IPO allotment date?
The allotment Date for Suraksha Diagnostic Ltd. IPO is 04tth December 2024. Login to your account now.
When is the Suraksha Diagnostic Ltd IPO listing date?
The listing Date for Suraksha Diagnostic Ltd. IPO is 06th December 2024. Login to your account now
What is the minimum investment required for the Suraksha Diagnostic Ltd IPO?
In the Retail segment the minimum investment required is Rs. 14,994. Login to your account now
What is the maximum investment allowed for the Suraksha Diagnostic Ltd IPO?
In the Retail segment the maximum investment requirement is Rs. 194,922. Login to your account now
What are the risks associated with investing in the Suraksha Diagnostic Ltd IPO?
- The diagnostics industry in India is highly competitive and comprises several listed and private players across all verticals, presenting the company with a challenge to gain market share and profitability. Accordingly, competitors may access more significant financial resources, research and development investment, and marketing. Hence, if the company fails to compete effectively with other healthcare service providers, it may adversely impact profitability and operations.
- The company has a presence across 12 cities and towns in India, including West Bengal, Bihar, Assam, and Meghalaya. However, most of its operations are concentrated in West Bengal, with the state accounting for ~95% of the total revenues. Thus, the regional slowdown in economic activity in West Bengal or any other developments may adversely impact the company’s business.
- The company operates in an industry exposed to heightened risks of legal claims and regulatory actions arising from non-compliance. Such risks may arise if the company’s medical professionals, technicians, and staff are not properly and adequately trained and also if they make errors in handling and labelling patient samples when operating complex medical equipment, even if properly trained.
When will the Suraksha Diagnostic Ltd IPO shares be credited to my Demat account?
The Suraksha Diagnostic Ltd IPO be credited to the account on allotment date which is 05th December 2024. Login to your account now
Where can I find the Suraksha Diagnostic Ltd IPO prospectus?
The prospectus of Suraksha Diagnostic Ltd IPO prospectus can be find on the website of SEBI, NSE and BSE
What are the important dates related to Suraksha Diagnostic Ltd IPO?
| IPO Open Date | Friday, November 29, 2024 |
| IPO Close Date | Tuesday, December 03, 2024 |
| Basis of Allotment | Wednesday, December 04, 2024 |
| Initiation of Refunds | Thursday, December 5, 2024 |
| Credit of Shares to Demat | Thursday, December 5, 2024 |
| Listing Date | Friday, December 06, 2024 |
| Cut-off time for UPI mandate confirmation | 5 PM on December 3, 2024 |
