This post on KIMS IPO attempts to bring out consolidated brokerage views , subscription information, Grey Market Premium (GMP) and anchor investor information where applicable. The information collated from various sources and reports in public domain can help investors to decide whether they should subscribe to KIMS IPO or not.
Related Posts : KIMS IPO Review
KIMS IPO: Grey Market Premium etc.
- 17-06-21 GMP Rs. 20
Consolidated Brokerage Views on KIMS IPO
Angel Broking : “Based on FY-2021PE of 31.2x and EV/EBITDA of 17.8x at upper band of the IPO price and are slightly better than the peers’ companies. Similarly, company having one of the best ROE & ROCE of 23.8% and 24.8% respectively. Company having a very healthy balance sheet with negative Net Debt/ Equity. We expect the upcoming expansion plan in Bangalore & Chennai can be funded through internal accruals and minimum amount of debt. We are assigning a “SUBSCRIBE” recommendation to the issue.”
Capital Market : ” Score 44/100 ; For FY 2021, consolidated sales were up by 18% to R 1329.94 crore. OPM rose 610 bps to 27.9% which led to 51% increase in operating profit to R 370.88 crore. Other income increased 67% to 10.17 crore while interest cost fell 19% to R 32.5 crore and depreciation decreased 2% to R 69.54 crore. PBT increased 99% to R 279.02 crore. Tax expenses was up 168% to Rs. 74.54 crore in FY21. Net profit rose 69% to R 201.22 crore. At the higher price band of R 825, the offer is made at around EV/Sales of 4.8 times and EV/bed of 2.1 times for the period ended March 31, 2021, on a post-issue equity share capital of R 80.02 crore of face value of Rs. 10 each.”
Choice Broking: “Subscribe with Caution. At higher price of Rs 825, demanded market cap of Rs6,601.4cr is valued at P/E of32.1x. EPS improved to Rs 25.7 in FY21 from Rs 14.4 in FY20 mainly driven by strong margin performance. On P/S(x) basis, KIMS is valued at5xP/Saboveindustryaverageof3.7x(Apollo, Narayana, Shalby and Kovai),which looks expensive. Business growth & return ratios maintained at healthy level but sustainability remains challenging.”
Geojit : “At the upper price band of Rs.825, KIMS is available at EV/EBITDA of 18.6x(FY21)which appears fully priced.We expect to see a recovery in patient footfalls and occupancy rates as lockdown restrictionsease. The company’s leadership position in the AP&Telangana along with expansion into new markets and increased bed capacity will be strong levers for future growth.We assign subscribe rating with a long term perspective”
ICICI Direct : “Amid advantage of regional dominance, operational efficiency, KIMS has demonstrated one of the best financial performances among peers. It also has almost net debt free b/s, healthy FCF in FY21 despite operating in an asset heavy industry. KIMS’ ability to turn around acquired assets also seems one of the best in industry. Hence, based on current performance, we assign SUBSCRIBE for listing gain. However, due to steep competition, expanding in others geographies may depress its financials, going ahead.”
Nirmal Bang: “The healthcare industry in India is poised for growth. The Indian healthcare delivery industry is expected to grow at a 17-18% CAGR (2020 – 2024E) and reach Rs 7.07 trillion by 2024. KIMS has emerged as a dominant player in AP and Telangana and successfully created a niche of its in affordable quality multispecialty healthcare space. The low-leverage approach for expansion and tight control on costs has resulted in KIMS getting one of the highest margins and ROEs among the peer group. Between FY18-21, KIMS revenues have grown at CAGR of 26% while EBITDA grew by 78%. We believe, the company has a sustainable growth model with steady margins. Considering the healthy balance sheet, robust revenue growth and strong cash flow generations we have a positive view on the company. At upper band of Rs 825, the company is commanding 18.4x EV/EBITDA which we believe is attractive and recommend “Subscribe”.
Prabhudas Lilladher: Listing Gains Likely, Consistency Key For Long-Term Gains”
SMC: “Score 2/5 ; KIMS is one of the largest healthcare service providers in Andhra Pradesh and Telangana states. It has grown from a single hospital to a chain of multi-speciality hospitals through organic growth and strategic acquisitions. Besides Tamil Nadu and Karnataka, it is exploring prospects of foraying into some parts of central India as well as Bhubaneswar in Odisha. However, KIMS major revenues are from hospitals in Hyderabad (Telangana) region. Any effect on location hospitals for various reasons can affect company financials. Moreover the issue is largely offer for sale. Along term investor may opt the issue”
SP Tulsiyan Website: “In view of contracting profit margin, structured objects of fresh issue, client concentration risk and unattractive pricing, one can give the KIMS IPO a miss.”
Ventura: “We value the stock at ₹1,275. This represents a potential upside of 55% from the IPO price of ₹825 per share (upper band) over the next 24 months,”
MORE WILL BE ADDED AS THEY BECOME AVAILABLE
Standard disclaimer: Standard disclaimer: I am not a SEBI registered analyst /investment adviser and above information is collated from various online sources and is for educational purpose only. Please visit individual brokerage sites to read the actual reports. Please do not make your investment decisions based on this info as it is not complete and exhaustive. Please do your own due diligence as stock market investments have high degree of inherent risk.