Dialysis chain NephroPlus engages with bankers for planned $200-250 mn IPO
Mumbai: Dialysis chain NephroPlus has engaged with bankers for a planned initial public offering to raise $200-250 million to fund expansion, two people familiar with the matter told Mint.
Backed by Investcorp and Quadria Capital, the company will file its draft papers with the regulator over the next three months, with the listing likely by next year, one person said. The person said the IPO will have a fresh capital raise and an offer by existing investors looking to sell a part of their stake.
'NephroPlus has engaged with ICICI Securities, IIFL Capital Services, Nomura and Ambit Capital to help with the issue," the second person said.
NephroPlus and the investment banks did not respond to Mint's requests for comment on the proposed IPO.
Also Read | Patients saved ₹16,000 crore under Centre's free dialysis scheme
Quadria, a healthcare-focused private equity firm, invested about ₹850 crore for a minority stake in NephroPlus last year through a combination of a primary investment and the purchase of shares from Investcorp, Bessemer Venture Partners, IFC, and IIFL Private Equity.
NephroPlus planned to use the funds raised from Quadria in the IPO for growth in India and overseas. With plans for additional acquisitions, specialised chains such as NephroPlus are expected to gain market share as hospitals increasingly outsource dialysis operations and governments seek to make high-quality dialysis services more accessible.
Demand for dialysis services in the company's target markets is expected to grow at over 11% annually over the next five years, Quadria said when it invested in the company in May 2024.
Founded by Vikram Vuppala and Kamal Shah in 2010, the Hyderabad-based company operates about 450 dialysis centres in 250+ towns and cities across India, the Philippines and Uzbekistan. It serves about 30,000 patients, carrying out 3 million dialysis sessions each year.
Healthcare growth
The company operates in marquee hospitals and standalone clinics, working with leading nephrologists, and also through public-private partnerships in urban and rural areas. Over the past three years, NephroPlus entered the Philippines by acquiring Royal Care Dialysis Centers Inc. and won a public-private partnership bid in Uzbekistan.
NephroPlus' revenue grew to ₹566 crore in FY24 from ₹438 crore a year earlier. It recorded a profit of ₹35 crore from a loss of ₹12 crore in FY23, according to an Entrackr report.
Also Read | Choppy markets take toll on pre-IPO deal talks
The Indian healthcare ecosystem is expected to grow at a CAGR of 16% to $527 billion over the next five years from $250 billion in FY24. The market includes services such as healthcare delivery, diagnostics, medical devices, pharmaceuticals, financing, and health-tech, according to a report by Praxis Global Alliance last year.
Of the $250 billion, healthcare delivery accounts for about 55% (about $135 billion) and is expected to grow at a CAGR of 18% over the next five years. Praxis added that the growth will be primarily driven by changing demographics, increasing urbanisation and health insurance coverage, improving medical tourism, favourable government policies, and rising health awareness and accessibility.
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