IPO Note : Nephrocare Health Services Ltd by Geojit Investments Ltd
Provider of Comprehensive Dialysis Care with a Global Footprint
Nephrocare Health Services Ltd. (NHSL), founded on December 18, 2009, provides end-to-end dialysis care through its extensive clinic network. Its offerings include diagnosis, treatment, and wellness programs, covering hemodialysis, home and mobile dialysis, and pharmacy support. As the largest provider in its segment, NHSL operates 519 clinics worldwide, including 51 international locations across the Philippines (41), Uzbekistan (4), and Nepal (6).
* In 2024, the global dialysis services market was estimated at ~USD 75.2 billion and is expected to grow to around USD 106.2 billion by 2029, indicating a compound annual growth rate (CAGR) of 7.1% over FY24–FY29 (Source: F&S Report).
* NHSL’s revenue and EBITDA grew at CAGRs of 31.5% and 85.2% between FY23–FY25, reaching Rs.756cr and Rs.167cr, driven by global expansion, a diversified model, and strategic hospital partnerships.
* Nephrocare has broadened its revenue mix, with international contributions increasing from 12% in FY23 to 32% in FY25, driven by new clinic openings and product launches in Uzbekistan and the Philippines.
* The total debt stood at Rs.258cr in FY25 (D/E at 0.4x), and upon utilisation of net proceeds from the IPO for debt repayment (~Rs.136cr), the debt-to-equity ratio will trim down to 0.1x which will strengthen balance sheet flexibility and enhance its ability to fund growth.
* At the upper price band of Rs.460, NHSL is valued at FY25 EV/EBITDA ratio of 29x, which appears reasonably priced compared to peers. NHSL is focusing on expanding its dialysis network across India, particularly in tier-II and tier -III cities, through a mix of greenfield and brownfield projects. The company aims to strengthen its presence by launching new clinics, partnering with hospitals for asset-light growth, and improving accessibility in underserved regions. Therefore, we recommend a SUBSCRIBE rating for investors with a long-term horizon.
Purpose of IPO
The IPO consists of a fresh issue of Rs.353.40cr and an OFS (offer for sale) of Rs.517.64cr, totalling Rs.871.05cr. The net proceeds from the IPO will be utilised for i) capital expenditure by the company for opening new dialysis clinics in India (Rs.129.11cr), ii) prepayment, or scheduled repayment, in full or part, of certain borrowings availed by the company (Rs.136cr) and iii) general corporate purposes.
Key Risks
* NHSL earns 37% of H1FY26 revenue from dialysis centers in private hospitals under a revenue-sharing model. Loss of these contracts could affect performance.
* The company operates 180 clinics (35% of total) under the PPP model, causing longer receivable cycles due to delayed government payments.
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SEBI Registration Number: INH20000034
