Rainbow Children's Medicare IPO Opens Today

The Rs 2,000-crore initial share sale of multi-speciality pediatric hospital chain Rainbow Children's Medicare Limited will open for public subscription on April 27.

The-three day initial public offering (IPO) will conclude on April 29, and the bidding for anchor investors will open on April 26, the red herring prospectus (RHP) with Securities and Exchange Board of India (SEBI) showed on Thursday.

The public issue comprises a fresh issue of equity shares aggregating up to Rs 280 crore and an offer sale of up to 2.4 crore equity shares by the selling shareholders.

Those selling shares in the offer for sale (OFS) are promoters - Ramesh Kancharla, Dinesh Kumar Chirla and Adarsh Kancharla,  promoter group entity Padma Kancharla and investors British International Investment plc (formerly known as CDC Group plc) and CDC India. 

The offer also includes a reservation of up to 3 lakh shares for subscription by eligible employees.

According to market sources, the IPO size is expected to be more than Rs 2,000 crore.

The company proposes to utilise the net proceeds from the fresh issue towards early redemption of non-convertible debentures (NCDs) issued by the company in full; capital expenditure towards setting up of new hospitals and purchase of medical equipment for such new hospitals; and general corporate purposes.

Rainbow, backed by UK-based development finance institution CDC Group plc, established its first 50-bed pediatric speciality hospital in 1999 in Hyderabad. Since then, it has established its reputation as a leader in multi-speciality pediatric services, with strong clinical expertise in managing complex diseases.

As of December 20, 2021, Rainbow operates 14 hospitals and three clinics in six cities in India, with a total bed capacity of 1,500 beds. 

Kotak Mahindra Capital Company, JP Morgan India and IIFL Securities are the books running lead managers to the issue.

The equity shares are proposed to be listed on BSE and NSE.