Suraksha Diagnostic to go deeper in eastern markets; IPO opens November 29

Three days before its initial public offering (IPO) opens for subscription on November 29, Kolkata-based Suraksha Diagnostic Ltd (SDL) said on Tuesday that it was planning to stay focussed on eastern India markets, which were “underserved”. The company has set a price band of Rs 420-441 per share for its Rs 846.25 crore issue. The IPO is entirely an offer for sale (OFS).   Ritu Mittal, joint managing director and CEO of SDL, said that they aim to invest Rs 70 crore every year for the next three-four years to open four-five big centres and 10-12 smaller centres every year. This would be funded from internal accruals.   Somnath Chatterjee, chairman and joint managing director of SDL, said that West Bengal and other eastern markets are largely underserved. Suraksha is still not present in eight-nine districts of West Bengal. The company aims to expand within West Bengal, and Northeastern states of Assam, Tripura, and Meghalaya instead of spreading wings to other geographies, Chatterjee said.   At present, SDL draws 44 per cent revenues from radiology and 56 per cent from pathology tests. It has an Ebitda (earnings before interest, taxes, depreciation and amortisation) margin of 35.7 per cent as of June quarter of the current financial year (FY25), beating peers like Dr Lal Pathlabs, Thyrocare, and Metropolis. South-based chain Vijaya Diagnostic has a better Ebitda margin of 41.48 percent.   Selling shareholders include Chatterjee, Mittal and Satish Kumar Verma.   Meanwhile, OrbiMed Asia II Mauritius Limited, which has remain invested in Suraksha for eight years now, is making a partial exit, and will retain 13 per cent stake in the diagnostics chain after the issue.