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Broach Lifecare's IPO: A High-Risk Bet in Specialized Healthcare

Published 15-08-2024, 06:26 pm
© Reuters.

Broach Lifecare Hospital Ltd. (BLHL) operates under the brand "Maple Hospitals," offering specialized cardiac care services. Initially, they provided non-invasive cardiology services such as 2D Echocardiography, Electrocardiography, and Holter monitoring, among others. In June/July 2023, they expanded into interventional cardiac services, including coronary angiography, stenting, and primary PCI for acute myocardial infarction. The company also performs advanced procedures like permanent pacemaker implantation, cardiac resynchronization, and treatments for congenital heart issues.

BLHL's flagship facility in Bharuch is a 25-bed ultra-luxury hospital equipped with state-of-the-art diagnostic and therapeutic devices. The hospital offers comprehensive cardiac care with life-saving equipment like Intra-aortic Balloon Pump Machines and Biphasic Defibrillators. Additionally, BLHL operates a 15-bed Satellite Hospital in Ankleshwar, which serves as a referral center for non-surgical, day-to-day treatments.

The company's hospitals are certified by the National Accreditation Board for Hospitals & Healthcare Providers (NABH) and hold necessary safety certifications, including the Atomic Energy Regulatory Board certification for PACS systems and fire safety certificates. BLHL is also part of Globe Bio Care, ensuring the proper disposal of biomedical waste.

As of March 31, 2024, BLHL had 19 employees on its payroll, with additional casual staff hired as needed. The hospitals are empaneled with various insurance companies and Third-Party Administrators (TPAs), and they have applied for inclusion in the Ayushman Bharat Yojana, India's flagship healthcare scheme.

BLHL is now launching its maiden IPO, offering 1,608,000 equity shares at a fixed price of INR 25 per share, aiming to raise INR 4.02 crore. The IPO opens on August 13, 2024, and closes on August 16, 2024. Post-IPO, the company’s paid-up capital will increase to INR 6.07 crore, with an expected market capitalization of INR 15.18 crore.

On the financial front, BLHL's performance has shown mixed results. As a corporate entity, the company reported a total income of INR 2.61 crore and a net profit of INR 0.70 crore for FY24. However, as a proprietorship concern, the company's financial performance showed declining revenues and profits over the past few years.

While BLHL operates in the promising healthcare sector, particularly in a niche market, the IPO is relatively aggressively priced. The small equity base post-IPO suggests a longer gestation period for returns, making this a high-risk investment. Potential investors may want to consider skipping this offering due to its relatively high price and mixed financial performance.

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