Home healthcare and wellness equipment producer Nureca’s IPO opens on February 15, 2021. It is the sixth IPO to launch, after IRFC, Indigo Paints, Home First Finance, Stove Kraft, and Brookfield India REIT. As the IPO market is gearing up in 2021, here are the key things to know about Nureca IPO.
The issuer plans to raise Rs 100 crores from the market, of which it has already received Rs 44.55 crores from two anchor investors on February 12. The issue comprises Rs 100 crores worth of fresh shares, including reservation of 1 crore shares for employees.
The Nureca IPO bidding window will open for two days from February 15 to February 17, 2021. Finalisation of allotment will happen on February 23, and the shares will list on the BSE and NSE stock exchanges on February 26, 2021.
Nureca IPO price band is set at Rs 396-400 per shares. Employees will receive a discount of Rs 20 on the share price.
The issuer has reserved one core shares for employees. Retail investors must bid for a minimum lot size of 35 shares. Hence, the minimum investment amount will be Rs 13,860 to Rs 14,000 for individual investors.
ITI Capital is appointed the book-running lead manager for the offer.
Nureca disclosed in DRHP that the fund it will raise would help to meet two distinct objectives.
When applying for an IPO, it is imperative to research the company’s fundamental – get a wholesome idea of the industry and its prospects before you invest.
Now let’s look at the company’s background to understand what it does.
Nureca is a digital-first company that produces home healthcare and wellness products. Started in 2016, the company manufactures innovative, high-end, quality, and durable products for end customers. It is India’s first digital company to sell wellness products through online e-tailing platforms, and its website, drtrust.in. Nureca also partnered with omnichannel electronics retailer Croma to make its products available to a larger customer base.
Nureca Ltd. designs and builds a wide range of products spread across five categories to monitor the health condition of chronic patients and improve the quality of their lives.
A critical measure of a company’s strength, let’s now look at the company’s financials.
According to WHO, the healthcare devices market can grow at a CAGR of 10 percent. India is a major market with a market share of more than 84 percent. Nureca is one of the leading players in the domain with a well-diverse product portfolio. As on the date of RHP filing, the company had 66 trademarks, 6 registrations, 92 design registrations, and applied for 12 more trademark registrations.
The company clocked a profit of Rs 6.39 crores at the end of 2020, reported a rise of 2.7 percent over the previous year. It also reported a 100.1 percent growth in profit in 2019 at Rs 6.22 crores over the year before.
Revenue from the operation grew at a 60.6 percent to Rs 99.42 crores in FY 20 against the previous year. The company reported EBITDA ratio of 38.89 percent. The company registered a substantial growth over its last year’s performance, aided by the outbreak of the pandemic. It clocked a profit of Rs 36.18 crores on a revenue of Rs 122.14 crores during the six months ended in September 2020.
SMC Global on a note mentioned, “The company is expected to see good growth on the back of its diversified portfolio range, growth in the home healthcare segment and higher online channel mix. On the flip side, significant challenges or delays in the company’s innovation and development of new products, technologies and indications could have an adverse impact on the company’s long-term success,”
Nureca has no close competitor to compare its performance against industry standards. So, investors have to bid based on available financial data and company performance. Between FY2018-20, company’s revenue grew at a CAGR of 122 percent, while its profit grew at a CAGR of 44 percent.
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