Sagility India IPO Day 2: Booked 52%, GMP Show Meager Listing Gains

Sagility India Ltd.'s initial public offering of shares worth Rs 2,106 crore has been subscribed 0.52 times, or 52% on the second day of bidding. The book building offer was subscribed 22% on its first day.

The entire IPO is an offer for sale. The price band has been set at Rs 28-30 per share. The minimum application lot size is 500 shares. The grey market premium of Sagility India was Rs 0.75, implying little gains over the IPO price, according to Chittorgarh's unit InvestorGain.

The company raised Rs 945.4 crore from anchor investors on Monday ahead of its initial public offering. The company allotted 31.51 crore shares at Rs 30 apiece to 52 anchor investors.

• Issue opens: Nov. 5.

• Issue closes: Nov. 7.

• Issue price: Rs 28-30 per share.

• Offer for sale: Rs 2,106 crore.

• Total issue size: Rs 2,106 crore.

Sagility India provides technology-enabled business solutions and services to clients in the US healthcare industry. The company was incorporated on July 28, 2021, however, it acquired the healthcare services business of the predecessor company on Jan. 6, 2022, which is when it started commercial operations.

Clients of Sagility India include Payers (US health insurance companies, which finance and reimburse the cost of health services) and Providers (primarily hospitals, physicians, and diagnostic and medical devices companies).

Services to 'Payers' cater to their core benefits administration functions such as claims management, enrolment, benefits plan building, premium billing, credentialing, and provider data management and clinical functions such as utilisation management, care management, and population health management.

Services to 'Providers' include revenue cycle management functions such as financial clearance, medical coding, billing, and accounts receivable follow-up services.

All of the company's clients are located in the US as of June 30, 2024.

• The healthcare services industry is highly competitive and if the company is unable to compete effectively, it may adversely affect the business, financial condition and results of operation.

• The business is solely focused on the US healthcare industry and may be adversely affected by factors affecting the US healthcare industry, including a decline in the growth of the US healthcare industry, reduction in outsourcing and other trends.

• Goodwill and other intangible assets are largest assets. Any impairment to the goodwill or other intangible assets may adversely affect the reputation and financial condition.

• One of the Independent Directors has received summons in relation to an ongoing investigation by SEBI of Linde India Ltd. and the matter is currently pending.

• Anti-outsourcing legislation could adversely affect the business, financial condition and results of operations and impair its ability to service customers.

The IPO was subscribed 0.52 times, or 52%, as of 05:00 p.m. on Wednesday.

• Qualified institutional buyers: 0.07 times, or 7%.

• Non-institutional investors: 0.24 times, or 24%.

• Retail investors: 2.24 times.

• Portion reserved for employees: 2.44 times.

The grey market premium of Sagility India was Rs 0.75 on Nov. 6, implying no gains over the IPO price, according to Chittorgarh's unit InvestorGain. The estimated listing price based on the GMP is Rs 30 per share.

GMP is not an official price quote for the stock and is based on speculation. 

Disclaimer: Investments in initial public offerings are subject to market risks. Please consult with financial advisors and read the red herring prospectus thoroughly before placing bids.