Shalby Hospital - Information Note

This document summarizes a few key points related to the issue and should not be treated as a comprehensive summary. Investors are requested to refer the Red Herring Prospectus for further details regarding the issue, the issuer company and the risk factors before taking any investment decision. Please note that investment in securities is subject to risks including loss of principal amount and past performance is not indicative of future performance. Nothing herein constitutes an offer of securities for sale in any jurisdiction where it is unlawful to do so.

This document is not intended to be an advertisement and does not constitute an invitation or form any part of any issue for sale or solicitation of an offer to subscribe for or purchase any securities and neither this document nor anything contained herein shall form the basis for any contract or commitment whatsoever.

Issue Opens - December 5, 2017
Issue Closes - December 7, 2017
Face Value - Rs.10
Price Band - Rs.245- 248
Issue Size – ~Rs.505 cr
Public Issue: 2.04 cr shares
Offer for Sale: 10 lakh shares
Employee Reservation - 1.21 lakh shares
Bid Lot - 60 Equity shares              
Issue Type - 100% Book Building

Source: RHP

Company Background

Shalby Hospital is one of the leading multi-specialty chain of hospitals in India(Source: F&S Report).The company’s hospitals are tertiary care hospitals and few of which also offer quaternary healthcare services to patients in various areas of specialization such as orthopaedics, complex joint replacements, cardiology, neurology, oncology, and renal transplantations. They provide inpatient and outpatient healthcare services through their 11 operational hospitals with an aggregate bed capacity of 2,012 beds. As on June 30th 2017, it had 9 operational hospitals with an aggregate operational bed count of 841 beds. Since March 2007, Shalby Hospital has conducted an aggregate of 92,100 surgeries, and provided healthcare services to an aggregate of 10,25,533 patients, consisting 1,33,652 inpatients and 8,91,881 outpatients. Headquartered in Ahmedabad, India, it has a domestic and overseas outreach through a network of hospitals in India, and Outpatient Clinics and Shalby Arthroplasty Centre of Excellence (SACE) located in India, Africa, and the Middle East. Shalby hospital has presence in western and central India and focus on Tier – I and Tier – II cities.

Offer Details

Purpose of this offer is to utilise the net proceeds from the fresh issue towards the following objects-Repayment or prepayment in full, or in part of certain loans availed by the company; Purchase of medical equipment for existing, recently set up, and upcoming hospitals. Purchase of interiors, furniture, and allied infrastructure for upcoming hospitals and general corporate purposes.

Key Points

The company’s reputation and clinical capabilities in the field of orthopaedics, along with continuing expansion across other healthcare specialties position Shalby favourably to benefit from increasing demand in India for quality healthcare services. Company has been a market leader in the area of joint replacement surgeries and in total it has conducted 54,105 joint replacements since 2007 (Source: F&S Report).

It has an established presence and strong brand recall in Gujarat, and an emerging presence in western and central India. The brand equity and operational experience in its core markets provides Shalby Hospital with the platform to further expand presence and operations in select locations across the country.

Key Risk

Orthopaedic services contributed 67.77% of its total revenue in Fiscal 2017. Financial conditions and results of operations are dependent on the revenue from orthopaedics due to this dependence on the field of orthopaedics, a number of factors such as loss of key experienced medical professionalsor regulatory changes could cause material fluctuations or decline in revenue. A decline in revenue from orthopaedics could materially and adversely impact the business, prospects, financial condition and results of operations.

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