Vijaya Diagnostics Files for an IPO

A Brief Overview

Diagnostics-focused Vijaya Diagnostics Centre Limited has filed a draft red herring prospectus (or DRHP) with the Securities and Exchange Board of India (or SEBI) for an initial public offering (or IPO). If this IPO is approved, it would allow its investors a partial exit from the company.

Vijaya Diagnostics is one of the key players in diagnostics in the southern part of the country providing its customers with extensive options for pathology and radiology testing. Its operational network is spread out far and wide and accounts for 80 diagnostic centers. Additionally, it has under its belt 11 reference laboratories. Each of these diagnostic centers and laboratories is present across 13 cities and towns located in Telangana, Andhra Pradesh, and Kolkata in addition to the National Capital Region.

Founded in 1981, Vijaya Diagnostics  has expanded enormously over the past 4 decades and has played the role of a pioneer in bringing the latest technology into its repertoire, and has consistently sought to provide the best-in-class healthcare to its customers as per its website.

Their website further lists as its mission of making their patients’ medical journey transpire with efficiency, transparency, and greater accuracy.

Vijaya Diagnostics Upcoming IPO

Vijaya Diagnostics’ initial public offering will be entirely offered for sale wherein 35.68 million shares will be made available by the company’s promoters in addition to Kedaara Capital, a private equity firm that has supported Vijaya Diagnostics thus far.

Vijaya Diagnostics will not raise fresh capital for its operations via the initial public offering.

Financial Performance and Positions

Listed below are relevant features highlighting the financial performance and position of Vijaya Diagnostics over the past few years.

Financial Performance in FY 2019, FY 2020, and FY 2021– Vijaya Diagnostics reported its revenue for each of these years amounting to INR 388.5 Crores, INR 354.1 Crores and INR 302.9 Crores, respectively. Profits for the same years amounted to INR 84.9 Crores, INR 62.5 Crores and INR 46.2 Crores each. FY2021 saw Vijaya Diagnostics earn 96.2 percent of its revenue from Telangana and Andhra Pradesh where it has some of its operations in place.

Investors – Kedaara Capital happens to presently be one of their most prominent and significant investors who first invested in the company in 2016. At the time they acquired a 40 percent stake amounting to over INR 400 Crore. Kedaara Capital seeks to dilute 30 percent of its stake in Vijaya Diagnostics.

Position – Vijaya Diagnostics serves as the country’s largest diagnostic chain providing comprehensive services.

Other Pertinent Information

Vijaya Diagnostics will be advised by Edelweiss, ICICI Securities, and Kotak Mahindra Capital in reference to its initial public offering.

The previous two funding rounds held by Vijaya Diagnostics amounted to USD 71.1 million in their entirety with the last funding being raised on March 17, 2017, via a Series A session.

Vijaya Diagnostics has received several accolades over the past few years including those that recognize it for being the best diagnostic service provider, a healthcare entrepreneur, and the most trusted diagnostic center.

The company has under its belt over 2200 professionals ranging from radiologists and pathologists to microbiologists. It has over 50 million customers who are of varied ages. Additionally, Vijaya Diagnostics has over 250 corporate clients and is recognized as being the preferred diagnostic partner for the same.

The Kukatpally center of Vijaya Diagnostics became the first diagnostic center in Andhra Pradesh and Telangana to acquire a National Accreditation Board for Hospitals and Healthcare Providers with regards to its medical imaging services in July 2019.

Concluding Thoughts

If approved and brought into fruition, Vijaya Diagnostics initial public offering will be made available to public investors. Their ability to continue to draw profits over the past three years is telling.