Sahajanand Medical Files for Rs. 1,500 Cr IPO

Top medical devices manufacturer Sahajanand Medical Technologies (SMT) has filed its Draft Red Herring Prospectus (DRHP) with SEBI. The company aims to raise Rs. 1,500 crores through its initial public offering.

As of now, SMT does not have any peers listed on the market. However, it is the second firm in the medical devices segment to file papers for IPO in September. Recently, Healthium Medtech, a company manufacturing medical consumables and sutures, filed for IPO with SEBI.

About the Company

Sahajanand Medical Technologies is a medical device manufacturing company headquartered in Surat. It is involved with the research, design, manufacturing and marketing of vascular devices.

SMT has a market share of 21%, 25% and 31% in fiscal years 2019, 2020 and 2021, respectively, in terms of total drug-eluting stent sales volume in India. It also claims to be one of the top 5 companies in market share of DES sales volume in Germany, Italy, Netherlands and Poland as of 31 March 2021.

A Close Look into IPO Details

As per its DRHP, Sahajanand Medical Tech IPO would be a combination of an OFS (offer for sale) of Rs. 1,089 crores and fresh issue of equity shares worth Rs. 410 crores. The company comes with some major investors, which include Samara Capital and Morgan Stanley Private Equity Asia. These investors hold 36.59% and 18.44% stakes, respectively. SMT IPO would provide a partial exit to them.

The OFS would consist of a share sell worth Rs. 100 crores by Dhirajkumar S Vasoya, Rs. 635.56 crores by Samara Capital and Rs. 320.36 crores worth shares by NHPEA Sparkle Holding BV. Moreover, Shree Hari Trust would be offloading shares worth Rs. 33.75 crores.

So, how is the company planning to utilise the proceedings obtained from its IPO?

Going by the draft paper filed, SMT would be using net proceeds from its IPO to:

• Meet working capital requirements for its foreign indirect subsidiaries
• Repay Rs. 255 crores worth debt

Bottom Line

SMT is planning for a pre-IPO placement of its shares which would help it to raise around Rs. 185 crores. If this pre-IPO placement takes place successfully, fresh issues would be reduced accordingly. SMT will finalise all the pertaining details of its IPO once it receives SEBI’s green signal.

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Frequently Asked Questions

1. Who are the lead running managers of SMT IPO?

UBS, Bank of America Securities, Axis Capital, and Edelweiss Financial Services are the lead running managers.

2. When is the opening date of Sahajanand Medical IPO?

The dates are yet to be announced.

3. Who are the legal advisors to SMT IPO?

Indus Law, Shardul Amarchand Mangaldas, and Trilegal are appointed as legal advisors.