Global Health Limited
Please refer to important disclosures at the end of this report
1
Incorporated in 2004, Global Health Limited (GHL) is one of the largest private
multi-speciality tertiary care providers operating in the North and East regions
of India. The company has key specialties in cardiology and cardiac science,
neurosciences, oncology, digestive and hepatobiliary sciences, orthopedics,
liver transplant, and kidney and urology. GHL has a network of 5 hospitals
currently in operation (Gurugram, Indore, Ranchi, Lucknow, and Patna) under
the "Medanta" brand. GHL provides healthcare services in over 30 medical
specialties and engages over 1,300 doctors led by experienced department
heads and, spanning over an area of 4.7 million sq. ft., its operational hospitals
have 2,467 installed beds.
Positives: (a) Strong track record of operational and financial performance (b)
Growth opportunities in existing facilities and diversification into new services,
including digital health (c) Leading tertiary and quaternary care provider in India,
well recognized for clinical expertise in dealing with complicated cases
Investment concerns: (a) High dependence on third party suppliers for raw
materials and on sub-contractors for cleaning and maintenance work (b) High
competitive intensity (c) Worsening of economic conditions would lead to slowdown
in business
Outlook & Valuation: In terms of valuations, the post-issue P/E works out to 45.9x
FY22 EPS (at the upper end of the issue price band) which is in line with its peers like
Narayana Hrudayalaya, Max Healthcare Institute Ltd and Apollo Hospitals Enterprise
Ltd. Further, GHL has better revenue/PAT growth (CAGR of 20%/132% respectively)
over 2 years, weaker return on equity and company also faces near term headwinds.
Considering all the factors, we believe this valuation is at reasonable levels. Thus, we
recommend a NEUTRAL rating on the issue.
Key Financials
Y/E March (₹ cr)
FY’20
FY'21
FY'22
Net Sales
1,500
1,447
2,167
% chg
-4%
50%
Net Profit
36
29
196
% chg
-21%
581%
EBITDA (%)
4.8
4.7
14.8
EPS (Rs)
1.4
1.1
7.7
P/E (x)
248.4
313.2
46.0
P/BV (x)
6.7
6.5
5.6
ROE (%)
2.7
2.1
12.1
ROCE (%)
3.1
2.9
11.8
EV/Sales
6.5
6.7
4.4
Source: Company RHP, Angel Research
NEUTRAL
Issue Open: November 03, 2022
Issue Close: November 07, 2022
Offer for Sale: ` 1,706cr
QIBs 50% of issue
Non-Institutional 15% of issue
Retail 35% of issue
Promoters 33.1%
Public 66.9%
Post Issue Shareholding Pattern
Post Eq. Paid up Capital: ` 53.62cr
Issue size (amount): ₹ 2,206cr
Price Band: ₹319 - ₹336
Lot Size: 44 shares and in multiple thereafter
Post-issue mkt. cap: * `8,580cr - ** `9,011cr
Promoters holding Pre-Issue: 35.03%
Promoters holding Post-Issue: 33.08%
*Calculated on lower price band
** Calculated on upper price band
Book Building
Fresh issue: ` 500cr
Issue Details
Face Value: `2
Present Eq. Paid up Capital: ` 50.65cr
IPO NOTE
Global Health Limited
November 2, 2022
Global Health Ltd | IPO Note
November 2, 2022
2
Company background
Incorporated in 2004, Global Health Limited (GHL) is one of the largest private
multi-speciality tertiary care providers operating in the North and East regions of
India. The company has key specialties in cardiology and cardiac science,
neurosciences, oncology, digestive and hepatobiliary sciences, orthopedics, liver
transplant, and kidney and urology. GHL has a network of 5 hospitals currently in
operation (Gurugram, Indore, Ranchi, Lucknow, and Patna) under the "Medanta"
brand. GHL provides healthcare services in over 30 medical specialties and engages
over 1,300 doctors led by experienced department heads and, spanning over an
area of 4.7 million sq. ft., its operational hospitals have 2,467 installed beds.
Issue details
The IPO is made up of Fresh issue of ₹500cr and offer for sale of ₹1,706cr
making the total Issue size of ₹2,206cr.
Pre & Post Shareholding
(Pre-Issue)
(Post-Issue)
Particulars
No of shares
%
No of shares
%
Promoter
8,87,25,240
35.0%
8,87,25,240
33.1%
Public
16,45,78,690
65.0%
17,94,59,642
66.9%
Total
25,33,03,930
100.0%
26,81,84,882
100.0%
Source: Company, Angel Research
Objectives of the Offer
◼ Rs 500cr proceeds from the fresh issue would be utilized as follows:
o Up to ₹375cr utilized for investment in two of its Subsidiaries,
GHPPL and MHPL, in the form of debt or equity for
repayment/prepayment of borrowings of such Subsidiaries.
Global Health Ltd | IPO Note
November 2, 2022
3
Financial Summary
Income Statement (Consolidated)
Y/E March (₹ cr)
FY’20
FY’21
FY’22
Net Sales
1,500
1,447
2,167
% chg
-4%
50%
Total Expenditure
1,314
1,255
1,716
Raw Material
325
349
543
Personnel
539
466
568
Other Expenses
450
440
605
EBITDA
187
191
451
% chg
3%
135%
(% of Net Sales)
12.4
13.2
20.8
Depreciation& Amortisation
115
123
130
EBIT
72
68
321
% chg
-5%
370%
(% of Net Sales)
4.8
4.7
14.8
Interest & other Charges
52
67
79
Other Income
44
31
39
(% of PBT)
68.7
96.8
14.0
PBT
64
32
281
% chg
-49%
764%
Tax
28
4
84
(% of PBT)
43.1
11.3
30.1
PAT
36
29
196
% chg
-21%
581%
Basic EPS (Rs)
1.4
1.1
7.7
Fully Diluted EPS (Rs)
1.4
1.1
7.3
Source: Company, Angel Research
Global Health Ltd | IPO Note
November 2, 2022
4
Balance Sheet (Consolidated)
Y/E March (₹ cr)
FY’20
FY’21
FY’22
SOURCES OF FUNDS
Equity Share Capital
49
50
51
Reserves& Surplus
1,300
1,333
1,565
Shareholders’ Funds
1,350
1,382
1,616
Minority Interest
-
-
-
Total Loans
929
931
1,109
Other Liabilities
75
79
107
Total Liabilities
2,354
2,392
2,832
APPLICATION OF FUNDS
Net Block
1,703
1,616
1,776
Goodwill
-
-
-
Capital Work-in-Progress
382
464
439
Investments
-
0
0
Current Assets
479
502
812
Inventories
39
40
53
Sundry Debtors
149
134
180
Cash
250
289
512
Loans & Advances
-
-
-
Other Assets
41
39
66
Current liabilities
305
302
314
Net Current Assets
174
200
498
Deferred Tax Assets (net)
-
26
28
Deferred Tax Liabilities (net)
8
-
-
Other Assets
103
87
91
Total Assets
2,354
2,392
2,832
Source: Company, Angel Research
Global Health Ltd | IPO Note
November 2, 2022
5
Cashflow Statement (Consolidated)
Y/E March (₹ cr)
FY’20
FY’21
FY’22
Profit before tax
64
32
281
Depreciation
115
123
130
Change in Working Capital
2
37
-67
Interest / Dividend (Net)
16
34
53
Direct taxes paid
(56)
-16
-98
Others
35
32
12
Cash Flow from Operations
175
242
311
(Inc.)/ Dec. in Fixed Assets
(188)
-142
-273
Movement in Bank Balances (Net)
81
(112)
-164
Interest Received
19
15
16
Cash Flow from Investing
(87)
(239)
-421
Proceeds from Issue of Share capital
0
0
38
Proceed / (Repayment) of long-term borrowings
94
(3)
215
Interest Paid on lease liabilities
(26)
(25)
-22
Payment of lease liabilities
(16)
(16)
-17
Interest / Dividend (Net)
(53)
(37)
-55
Cash Flow from Financing
(1)
(81)
160
Inc./(Dec.) in Cash
87
(78)
50
Opening Cash balances
60
148
69
Closing Cash balances
148
69
119
Source: Company, Angel Research
Key Ratios
Y/E March (₹ cr)
FY’20
FY'21
FY'22
Valuation Ratio (x)
P/E (on FDEPS)
248.4
313.2
46.0
P/CEPS
59.6
59.4
27.7
P/BV
6.7
6.5
5.6
EV/Sales
6.5
6.7
4.4
Per Share Data (Rs)
EPS (Basic)
1.4
1.1
7.7
Cash EPS
5.6
5.7
12.1
Book Value
50.3
51.6
60.3
Returns (%)
ROE
2.7
2.1
12.1
ROCE
3.1
2.9
11.8
Source: Company, Angel Research;
Global Health Ltd | IPO Note
November 2, 2022
6
Research Team Tel: 022 - 40003600 E-mail: [email protected] Website: www.angelone.in
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