Shares of Rainbow Children’s Medicare, multi-specialty hospital chain, slumped 17 per cent on their stock market debut on Tuesday. The stock finished at Rs 450, Rs 92 below its issue price of Rs 542 per share.
This is the worst-listing day performance for IPOs listed this calendar year. The poor listing performance comes despite encouraging response to the Hyderabad-based firm’s Rs 1,300-crore IPO. The offering was oversubscribed 12 times. Market players blamed poor secondary market conditions for the weak debut.
Rainbow Medicare’s IPO closed on April 29. Since then, the benchmark Nifty has slumped over 6 per cent. Shares worth nearly Rs 900 crore were traded on Tuesday.
At the last close, the company had a market cap of 4,569 crore. Rainbow Medicare trades at a price-to-earnings (P/E) ratio of around 36 times based on trailing 12-month (Dec 21) earnings for share (EPS) of Rs 12.6.
Peers such as Apollo Hospital and Fortis Healthcare are trading at P/E of 75 times and 55 times, said an analyst.
Rainbow Medicare is a leading pediatric multi-specialty healthcare chain with strong clinical expertise in managing complex diseases.
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