Children’s Hospital Group Rainbow Gets SEBI Nod for Rs 2,000 cr IPO

Rainbow Children’s Medicare, a multi-specialty hospital network sponsored by United Kingdom-based development financing organization CDC Group plc, has acquired SEBI clearance to undertake an initial public offering for Rs 2,000 crore. The IPO consists of new issuance of equity shares worth up to Rs 280 crore and an offer sale by the selling shareholders of up to 24,000,900 equity shares.

The proceeds from the sale from the new offering will be used to pay the company’s initial redemption of NCDs, as well as capital spending for the construction of new clinics and the acquisition of surgical supplies for those clinics, as well as other business reasons. A reservation for subscriptions by qualified workers is also included in the offer. As of March 31, 2021, the Hyderabad-based specialty chain is one of India’s leading multi-specialty pediatric care providers in terms of hospital beds.

Dr Ramesh Kancharla, an NRI doctor turned entrepreneur, founded Rainbow’s first 50-bed pediatric specialist hospital in Hyderabad in 1999. Rainbow maintains 14 hospitals and three clinics in six Indian cities, with a total bed capacity of 1,500 beds, as of September 30, 2021.

In Srinagar, Rainbow Children’s Hospital has opened a Pediatric Super Specialty

In collaboration with Kashmir Clinics in Batamaloo, Srinagar, Rainbow Children’s Hospital in Delhi has opened a Pediatric Super Speciality in the city, with the goal of delivering better and more effective treatment to children. Rainbow Children’s Hospital physicians will be accessible at Kashmir Clinics on a regular basis from Sunday 10:30 a.m. to 2:00 p.m. in this respect.

Dinesh Vashist, VP and Cluster Head, Delhi-NCR, said that they are India’s foremost multi-specialty advanced pediatric and obstetrics & gynecology hospital network, with 14 hospitals and three clinics spread across six cities with a total bed capacity of 1,500 beds.

Tightening IPO Assessment Criteria

Worried bankers and corporations concerned about listing delays say India has increased its inspection of IPO-bound companies, concentrating on how key internal business measures are used to arrive at valuations.

Following the collapse of a $2.5 billion IPO by a SoftBank-backed payments company in November, which drew criticism for a lack of oversight of how loss-making companies price problems at what some think are excessive prices, India has ramped up its efforts.

Last month, the Securities and Exchange Board of India expressed worry by advocating stricter disclosures, citing an increase in the number of new-age IT businesses seeking initial public offerings and the possibility that conventional financial disclosures may not be helpful to investors.

Even before the plan is finalized, SEBI has required that several firms have their non-financial measures scrutinized and explain how they were utilized to arrive at an IPO’s value. According to sources, KPIs for a software or app-based firm are generally publicly available data such as the number of downloads or average time spent on a platform metrics that are difficult to assess or relate to a company’s worth.

Further Key Takeaways

When India’s startups and other firms have become a favorite for international investors and are progressively hitting the markets, the scrutiny becomes more intense. More than 60 firms, including high-profile IT companies, debuted on the stock market last year, raising more than $13.5 billion, with many more in the pipeline.

However, the Paytm IPO prompted questions regarding values. The Indian payment firm’s shares are presently trading 64 percent below their issue price, after plummeting on listing day, and some investment managers have predicted that the experience would “hopefully bring some reality to values.”

Bankers, lawyers, and companies are anxious as the inquiry continues, despite the fact that SEBI’s proposal on whether such Key performance indicator filings should be implemented or not is open for public feedback until March 5, according to sources.

Disclaimer: This blog is exclusively for educational purposes and does not provide any advice/tips on investment or recommend buying and selling any stock.