Entero Healthcare Solutions witnessed a tepid response from investors as its public issue opened on Day 1, falling short of expectations. With a subscription rate of just 10%, the initial public offering (IPO) valued at ₹1,600 crore struggled to garner interest. As the issue progresses into Day 2, investors remain cautious about its potential.
The IPO, priced between ₹1195 to ₹1258 per share with a face value of ₹10 each, attracted bids for only 6.91 lakh shares against the available 71.50 lakh shares (net-off anchor investors). Notably, the retail portion subscribed only 0.45 times, while non-institutional investors subscribed a mere 0.04 times of their quota. Qualified institutional buyers (QIBs) are yet to make bids.
Entero Healthcare Solutions allocated 56,94,753 shares to 25 anchor investors, including prominent names like Capital Group, GIC, and TT Emerging Markets Unconstrained Fund, raising ₹716 crore. The IPO comprises a fresh issue of ₹1,000 crore and an offer-for-sale (OFS) of up to 47,69,475 shares.
The company has allocated shares worth up to ₹8 crore to its employees, offering a discount of ₹119 per share to eligible staff members. However, the staff quota was subscribed only 0.33 times.
Entero Healthcare Solutions plans to utilize the net proceeds from the IPO for financing long-term working capital needs for FY 2025 and 2026, pursuing inorganic growth initiatives through acquisitions, and for general corporate purposes. Additionally, the company may use the funds for repayment or prepayment of certain borrowings.
With ICICI Securities Ltd, Dam Capital Advisors Ltd, Jefferies India Private Limited, JM Financial Ltd, and SBI Capital Markets as the book-running lead managers, and Link Intime India Private Ltd as the registrar, Entero Healthcare Solutions aims to leverage its technology-driven platform to distribute healthcare products efficiently across India.
The company caters to pharmacies, hospitals, and clinics, offering a wide array of over 64,500 stock keeping units (SKUs) with real-time inventory records, order fulfilment, and claims settlement services.
Despite the subdued response during the initial phase, Entero Healthcare Solutions remains optimistic about its growth prospects and the value it offers to investors in the long run.