Poly Medicure hits fresh high; stock zooms 53% over QIP price

Shares of Poly Medicure hit a new high of Rs 804 after rallying 11 per cent on the BSE in intra-day trade on Tuesday. With today’s gain, the stock of the medical equipment company has surged 53 per cent over its qualified institutional placement (QIP) price of Rs 524 per share.

Last month, on February 19, Poly Medicure had raised Rs 400 crore by allotting 7.63 million equity shares of the company to eligible qualified institutional buyers (QIB) at the issue price of Rs 524 per share.

Foreign portfolio investors (FPIs) Smallcap World Fund Inc and Lighthouse India III Equity Investors Limited had bought more than 1 per cent stake each in the company. UTI – Healthcare Fund had also purchased a 1 per cent stake, the shareholding pattern filed by the company post the QIP issue shows.

Meanwhile, ace investor Ashish Kacholia held 1.75 million equity shares or a 1.83 per cent stake in Poly Medicure as of February 19, 2021, as per the shareholding data.

The company said it proposed to utilise the net proceeds for funding suitable organic and inorganic growth opportunities, ongoing capital expenditure, other long-term and short-term requirements, pre-payment and/or repayment of outstanding borrowings and general corporate purpose, or any other purposes.

Indian firms engaged in the medical devices sector are typically small and medium-scale enterprises, manufacturing products such as disposable and medical supplies and competing in low-priced, high-volume segments. Indian players like Hindustan Syringes and Poly Medicure hold a higher share of the consumables market than multi-national companies. Due to Covid-19 related medical requirements, manufacturing and demand for consumables and disposables have increased significantly.

Medical consumables and disposables grew as Ayushmaan Bharat helped increase health service penetration in India, aiding to growth in the medical procedure and treatments conducted in India. An increase in insurance penetration, medical treatments supported by the PMJAY Ayushmaan Bharat, and usage of technological and medical equipment in public, as well private hospitals, across rural and urban India also supported the medical devices industry.

India is among the fast-growing markets for healthcare and medical devices in the Asia-Pacific region. With improving medical device regulations, setting up of the National Medical Devices Promotion Council, and the government’s focus on manufacturing of medical device, there is an increasing potential for the Indian medical manufacturing industry, the company had said in the QIP placement document.