Medi Assist Healthcare stock may list at 5-12% premium over IPO price

Medi Assist Healthcare stock may list at a 5-12 percent premium over the IPO price on January 23, according to analysts. The offer received a strong response from investors and now the stock is expected to open somewhere between Rs 440-470 against the issue price of Rs 418 owing to the marquee names in the list of anchor investors list, dominance in the TPA (third-party administrator) market, and decent financial performance.

Medi Assist acts as a mediator between general and health insurance companies and their insured members, insurance companies and healthcare providers (such as hospitals), and the Government and beneficiaries of public health schemes. The company collaborated with 36 insurance companies in India and worldwide as of March 31, 2023. “We expect the listing of Medi Assist could be around Rs 450-470,” said Amit Goel, Co-Founder and Chief Global Strategist at Pace 360.

Medi Assist Healthcare Services was subscribed 16.25 times, receiving bids for 31.87 crore shares against the issue size of 1.96 crore shares. The retail portion was booked 3.19 times, qualified institutional buyers (QIB) picked 14.85 times and high net worth individuals (HNI) bought 40.14 times of the allotted quota.

Considering muted sentiments in the markets after touching a fresh lifetime high and decent response received from all sets of investors on the last day of subscription, Prashanth Tapse, Sr VP Research & Research Analyst at Mehta Equities expects a 5-10 percent listing gain to its issue price.

“The decent listing premium is justified on the back of strong order marquee names in the list of anchor investors including Nomura Trust, Goldman Sachs, Ashoka Whiteoak, Pinebridge Global Funds, Troo Capital, and HSBC. We believe Medi Assist IPO allows investors to invest in a leading Third Party Administrator (TPA) health-tech and insurance-tech company which is serving the emerging Indian health insurance sector,” said Tapse.

The Bengaluru-based company raised Rs 1,171.58 via an offer-for-sale of 2.8 crore shares. The price band for the issue, which closed on January 17, was fixed at Rs 397-418 per share.

The stock was commanding a 9 percent premium in the grey market, an unofficial ecosystem where shares start trading before the allotment in the IPO and continue till the listing day. Most investors track the grey market premium (GMP) to get an idea of the listing price.

Medi Assist’s market-leading position as a third-party administrator in India enhances the ability to benefit from the prospects of the health insurance industry, enhances profitability, and strengthens value proposition due to increasing economies of scale, ability to invest in cutting-edge technology, and better scale for negotiating with healthcare provider networks. “We expect the stock to list at a premium of around 6 percent to the issue price of Rs 418 per share,” said Prathamesh Masdekar, Research Analyst, StoxBox. Moneycontrol