Global Health Limited - IPO Note

Hospital & Healthcare Services

Global Health Limited - IPO Note

Hospital & Healthcare Services

Price range
Rs. 319-336
Issue Period:
Nov 03, 2022
Nov 07, 2022
November 05, 2022

Stock Info

CNX Nifty
Face value (Rs.)
Market lot
Issue size
Rs. 2206 cr.
Public Issue
6.56 cr. shares
Market cap post IPO
9011 cr.
Equity Pre - IPO
25.3 cr.
Equity Post - IPO
26.8 cr.
Issue type
Offer for Sale and Fresh issue

Shareholding (Pre IPO)

Source: Ace equity, StockAxis Research

Shareholding (Post IPO)

Source: Ace equity, StockAxis Research

Company Description

Global Health Ltd. was incorporated on 13th August 2004 at New Delhi. It is one of the largest private multi-specialty tertiary care providers operating in North and East parts of India. The company currently has 5 hospitals in Gurgaon, Indore, Lucknow, Ranchi and Patna. The 6th hospital is under construction in Noida. The company has a multi-specialty clinic in DLF cyber city, Gurgaon. The company provides facilities such as lever transplant, cardiac sciences, neuro sciences, oncology, digestive orthopaedics, hepatobiliary sciences, kidney and urology under the brand name ‘Medanta’. The company provides healthcare services in over 30 key specialties, with over 1300 doctors and 2467 beds facility in its hospitals. It’s renowned hospital in Gurgaon has 1391 beds as of 30 June 2022. Apart from these services company also provides homecare services where it facilitates delivery of medicine, preventive health check-ups, sample collection, nursing services, etc.

Facilities of Medanta

Entity Hospital/ Clinics operated by the entity FY20 FY21 FY22 30-Jun-22
GHL (standalone) Medanta – The Medicity, Gurugram 1472.086 1227.398 1764.249 472.432
  Medanta Super Speciality Hospital, Indore        
  Medanta Abdur Razzaque Ansari Memorial Weavers’ Hospital, Ranchi        
  Multi-speciality clinics and outpatient facilities at DLF Cybercity Gurugram, Delhi Airport, south Delhi, Darbhanga, Patna and Subhash Chowk, Gurugram        
MHPL (standalone) Medanta Lucknow Hospital 28.491 219.632 379.331 116.99
GHPPL (standalone) Jay Prabha Medanta Super Specialty Hospital, Patna - 0.227 23.773 28.025

Consistent strong operational and financial performance with facility of Large scale hospitals
The Gurgaon hospital is the flagship hospital of the company. In this hospital they have 40 operating rooms, bed capacity of 1391 and 285 ICUs as of 30 June 2022. In its Lucknow hospital they have over 473 beds installed whereas in Patna they have 228 beds installed as of 30 June 2022. Overall they have latest technology based medical equipment’s required to practice high end medical care. In all the hospitals of Medanta they have provided 30% area to critical care and the chain has total 70 OPDs. The company is taking strategic innovative moves and is trying to diversify its services by adapting digital channels for providing healthcare services. They have upgraded on there telemedicine and home delivery Healthcare facilities.

Over the years Medanta has become an established brand which is successful in keeping trust of it clients. In FY 20, FY21 and FY22 the patient volumes were 1178230, 2073619 and 440766 respectively. Revenue from operations have increased significantly in FY22 with total sales at Rs 2167 Crores while EBITDA at Rs 490 Crores. There was a slight de growth in FY21 but the company managed to achieve new levels of growth in its financials in FY22

Key Operational and Financial Information

Particulars FY20 FY21 FY22 30-Jun-22
Facility build-up area (in million sq. ft.) 3.7 3.7 3.7 4.7
Bed capacity/installed beds 2141 2176 2404 2467
Operational beds 1517 1579 1779 1866
Total occupied bed 832 814 1076 1111
Average occupancy levels 54.85% 51.57% 60.50% 59.57%
Number of operating theatres 65 65 69 69
Number of ICU beds 489 494 504 523
Income from healthcare services (in Rs cr.) 1480.57 1417.84 2100.39 596.08
Average revenue per occupied bed (ARPOB) 50166.34 47730.59 54547.29 58960.99
Average length of stays in hospitals (ALOS) 3.52 3.89 3.76 3.22
OPD volumes 1305559 1101780 1971260 559125
IPD volumes 83901 76450 102359 31351
Revenue from outpatient pharmacy business(in Rs cr.) - 11.48 53.63 18.6

Income from healthcare services breakdown

Healthcare services FY20 FY21 FY22 30-Jun-22
Heart Institute 26.22% 20.65% 20.93% 24.32%
Institute of Neurosciences 10.41% 10.49% 11.16% 11.81%
Institute of Musculoskeletal Disorders and Orthopaedics 6.30% 3.68% 4.48% 5.86%
Kidney & Urology Institute 8.24% 7.95% 7.22% 7.55%
Cancer Institute(2 11.60% 12.26% 10.82% 11.91%
Institute of Digestive and Hepatobiliary Sciences 11.84% 11.71% 10.19% 11.66%
Institute of Liver Transplantation and Regenerative Medicine 4.35% 3.98% 3.56% 3.69%
Medanta’s Internal Medicine Division 5.59% 10.91% 11.26% 5.88%
Others 15.45% 18.37% 20.37% 17.36%
Total 100.00% 100.00% 100.00% 100.00%
Global Health
Global Health

Increasing revenue on back of operational efficiency
Medanta’s operational efficiency has increased significantly over past 6 years. Its budding hospitals have contributed well in total income of the company past three years from 1.92% in FY19 to 23.43% as of June FY22. The company’s matured hospitals have already build strong footprints in the industry with cost efficiency in there operations reaching there highest in FY22. The EBITDA margin of the company’s matured hospitals was 22.81% in FY22 and it was 19.55% for developing hospitals. Strong cost optimization and strategic approach of increasing the bed capacity aided in early breakeven of new hospitals. Company managed to grow its ‘Average revenue per occupied bed’ consistently over the past three fiscal years and 3 months ended June FY22. The occupancy by number of days by patient has also increased over the years which has supported an upward momentum in revenues of the company.

Revenue from Matured Hospitals with >6 years

Particulars FY20 FY21 FY22 30-Jun-22
Total Income contribution to total income (%) 98.15% 84.95% 81.60% 76.70%
EBITDA Margin (%) 16.97% 15.67% 22.81% 22.62%
Operational Beds 1377 1284 1431 1430
Average revenue per occupied bed (₹) 50302.8 47682.69 54272.99 59291.14

Revenue from developing Hospitals with <6 years

Particulars FY20 FY21 FY22 30-Jun-22
Total Income contribution to total income (%) 1.92% 15.02% 18.45% 23.43%
EBITDA Margin (%) -81.03% 15.36% 19.55% 22.55%
Operational Beds 280 295 298 335
Average revenue per occupied bed (₹) 44223.59 48062.62 55883.03 56499.73

Focus on Clinical expertise through research and academics
Company focuses complex cases and provide its super specialization and clinical expertise. The Medanta group has its own research house in the name of ‘ The Medanta Institutional Tissue Repository’ , 2017 to promote biomarker along with other tissue based research. The company is currently working on developing an algorithm which will help it in diagnosis of radiology scans. This is a significant move in digital healthcare services.

Prudent expansion by focusing on underserved areas with densely populated regions
The company aims to provide advance healthcare to all and wants to serve the under served areas with large population where there is scarcity of medical facilities and resources. It is present in Lucknow and Patna where it was observed that medical facilities are not accessible to all due to scarcity of resources. In Lucknow total estimated beds of private key hospitals are 1718 & in Patna this number is 933 beds leaving huge room for company’s services.

Peer Comparison

Name of Company Operating Income (Cr.) Operating Margin % NPM (%) ROCE (%) Bed Capacity EPS PE
Global Health Ltd. (Medanta) 2177.20 21.40 9.00 16.30 2404.00 7.78 43.10
Apollo Hospitals Enterprises Ltd. 14676.90 15.00 7.60 25.50 9911.00 77.10 57.00
Fortis Healthcare Ltd. 5656.70 17.90 14.00 29.70 NA 10.50 26.90
Healthcare Global Enterprises Ltd. 1397.80 17.10 2.80 13.90 1944.00 3.90 76.66
Max Healthcare Institute Ltd. 5218.00 26.70 16.00 NA 3412.00 6.20 74.51
Narayana Hrudalaya Ltd. 3701.30 17.80 9.20 27.20 6584.00 16.70 44.70
Shalby Ltd. 702.00 17.50 7.70 8.80 - 5.00 28.60

Note: The prices are taken on the basis of current day. (4th Nov.CY22)


  • Capital intensive industry
    The company operates in a capital intensive industry where failure to generate cash or higher revenues may impact capability to invest for future.
  • Highly Competitive industry
    Hospital industry is very competitive in terms of large players cornering major share in the market. Company has to compete with well-established players like Apollo, Max healthcare, etc. which may be challenging for it.


Medanta group is a well established player in hospital chains industry. The company has its focus on providing healthcare services along with super specialised services through remote channels. During FY22 the company was placed at 4th position (in terms of its revenue) in the list of listed peers. It is consistently taking steps to move forward and diversify its healthcare services specially for digital channels. The company’s EV/ Per Operational bed for FY22 stood at 5.29. We believe the growth aspects are good and progressive in nature. At upper band of IPO price of Rs 336 asking valuation is 43.1x of its FY22 earnings.

We recommend ‘Subscribe’ to the IPO offer.

Key Information

Use of Proceeds:

  • The offer is a combination of an ‘Offer for sale and issue of fresh shares’. The company intends to garner Rs 2206 Cr. from this issue.
  • The company wants to use the proceeds for repayment / prepayment of borrowings in full or part of the subsidiaries GHPPL and MHPL. Other than this it will be used for general corporate purposes.

Book running lead managers:
Kotak Mahindra Capital Company Limited Credit Suisse Securities (India) Private Limited Jefferies India Private Limited JM Financial Limited

Dr. Naresh Trehan (Chairman and Managing Director) Sunil Sachdeva (Non-Executive Director) Pankaj Prakash Sahni (Chief Executive Officer) Sanjeev Kumar (Chief Financial Officer)

Financial Statement

Profit & Loss Statement:- (Consolidated)

Particulars FY20 FY21 FY22 30-Jun-22
Equity share capital 49.35 49.59 50.65 50.65
Reserves 1267.69 1300.26 1565.37 1624.91
Net worth 1349.54 1382.34 1616.01 1675.55
Revenue from operations 1500.42 1446.74 2166.59 617.21
Revenue growth - -3.58% 49.76% 27.13%
EBITDA 230.45 222.85 489.76 141.65
EBITDA Margins % 15.36% 15.40% 22.61% 22.95%
PAT 36.33 28.81 196.20 58.71
PAT Margins% 2.42% 1.99% 9.06% 9.51%
EPS - Basic (Rs/share) 1.45 1.15 7.78 2.32
RoNW % 2.69% 2.08% 12.14% 3.50%
Net asset value (rs) 54.70 55.76 63.82 66.17
Total Borrowings 551.80 568.20 783.30 740.30

Key Valuations metrices

Valuation FY22
EV/Per operational bed (in Rs cr.) 5.29
Average revenue per operational bed (Rs) 54272.99
EV/EBITDA (x) 18.7
Market cap/sales (x) 4.2
D/E (x) 0.7
P/E (x) 43.1

Note: The valuations are calculated on upper price band of Global Health. & FY22 numbers.