Azad Moopen says that the wheels are in motion for the IPO and that Aster DM Healthcare is set to refile DRHP
Text Credit: Rochelle D’Souza Featured Image source: asterhospitalsmvt.com
Aster DM announced that it would go public by or before the next financial year in a meeting held in Kochi on Thursday afternoon. Aster Chairman and Managing Director who was in the city to announce the commencement of three new projects of the group stated that the company is gearing up for the IPO.
“At this point, I don’t wish to make too many statements on the IPO. All I can say is that Aster will be going public by or before the next financial year. We are in the process of drawing up the paper and are set to file our DRHP. So yes, it’s definitely in the works.” said Aster’s Chairman, Azad Moopen, the physician-turned entrepreneur from Kerala who commenced his business in 1987 as a single doctor clinic in Dubai. Aster also announced on Thursday that it is in the process of constructing three healthcare facilities in the state including a dedicated children’s hospital in Kochi at a total cost of around Rs.1000 crore.
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Aster DM Healthcare had previously filed its draft red herring prospectus (DRHP) for IPO in June 2016 with an intention to raise around Rs 2,000 crore, to provide an exit to existing PE investors, repay debt, and invest on expansion.
The IPO received approval from the Securities and Exchange Board of India (Sebi) in November, but Aster DM Healthcare has deferred the public issue – with its overseas business – especially the hospital business in Gulf region which was impacted due to slump in the oil price and economic slowdown.
“For instance, in Saudi Arabia, where a substantial portion of our revenues are derived from patients referred and funded by the Ministry of Health, a decline in oil prices and the overall economic conditions have had a direct impact resulting in an increase in our receivables position from the Ministry of Health. In order to counter this, we may explore other business opportunities in Saudi Arabia, including increasing our share of private insurance and walk-in patients. However, there can be no assurance that we will be able to successfully secure alternate sources of revenue in Saudi Arabia, or at all,” the company had said in its June 2016 DRHP.
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The Gulf region accounts almost 90 percent of company’s net revenues of Rs 3,875.8 crore in FY15. In June last year, Aster DM Healthcare was eyeing a market capitalisation of over Rs 16,000 crore just behind India’s largest hospital chain Apollo Hospitals and more than the combined value of two other listed entities Fortis Healthcare and NarayanaHrudayalaya.
Aster DM Healthcare is one of the largest private healthcare service providers in Asia with operations in multiple countries including India, UAE, Oman, Saudi Arabia, Qatar, Kuwait, Bahrain, Jordan and the Philippines.
It has diversified portfolio of healthcare facilities, consisting of six hospitals, 83 clinics and 180 retail pharmacies in the Gulf region, seven multi-specialty hospitals and three clinics in India, and one clinic in the Philippines as of March 31, 2016. It also operates 180 standalone retail pharmacies in GCC states besides those integrated with its hospitals in India.