Neuberg Diagnostics eyes IPO in FY23-end
Apart from specialty diagnostics, it is also into routine diagnostics and pathological tests. Compared to routine pathological testing which are priced at ₹ 500 and upwards in India, specialty genomics are priced upwards of ₹ 10,000–15,000.
The company is working on the DRHP and other details – which include finalizing a merchant banker – apart from awaiting approval of merging two other group entities. Application for merger of two other entities – Supratech Microtech and Anand Diagnostic – with Neuberg Diagnostics is pending with the NCLT.
DRHP being prepared
According to Dr GSK Velu, Founder-Chairman and Managing Director, Neuberg, a part of the IPO proceeds will be used for expansion of facilities in India too.
Currently, super-specialty genomics testing is being used in the US and West Asia for personalized medicines, molecular pathology, and precision diagnostics. These tests find use during treatment of oncological issues, inherited genetics, reproductive genetics among others.
“We are looking at an IPO either by the end of this fiscal in Q4-FY22 or Q1-FY23 depending on market conditions. The processes like finalizing a merchant banker, preparing DRHP are already on, ”Velu told BusinessLine.
“We could do a pre-IPO or so, if there is delay in going for listing. But at the moment there are no fund-raising plans specially from PEs, ”he added.
The lab’s network
The ₹ 900-crore Neuberg Diagnostics – which remains debt-free and has been funding acquisitions through internal accruals – has grown 3x, over the last four-odd years. It has over 150 laboratories, of which 20 are located overseas, including West Asia and the US. Of the remaining about 130 labs, a majority are located in South and West Indian markets. Plans are afoot to take it up to 200 over the next few years.
The company is amongst the leading diagnostics service providers in Karnataka, Gujarat and Tamil Nadu (and Pune), with 95 per cent of its revenues coming in from these States. “We have a strong presence in South and West India. The plan is to grow in North India. We are open to acquisitions here too, ”Velu said.
According to him, the routine diagnostics market in the country will see “rapid consolidation” with larger and branded players coming in and acquiring smaller regional players. The market would also be getting streamlined in favor of larger players, like in mature countries like the US.
“Today, there are roughly 50,000 labs all across India and not all are NABL-accredited. It will not be surprising if consolidation brings this number down to 5,000 and there being a handful of large branded players, ”Velu said.
June 07, 2022