Shares of drugstore retailer MedPlus Health Services made a decent start on the stock market on Thursday with the securities listed on ??1,040 per share on the NSE, a premium of more than 30% compared to its IPO issue price of ??796 each. On BSE, MedPlus shares started trading on the first day at ??1,050. The stock jumped again to an intraday high of ??1,119 in the first transactions.
“Long-term investors should own the stock and it could become a wealth creator in the next 2-3 years, however, short-term investors are advised to keep an SL of ??875. We believe that the industry’s growth opportunities will justify valuing the company in the long run, even if it seemed expensive at first glance, ”said Santosh Meena, Research Manager, Swastika Investmart Ltd.
MedPlus Health’s initial public offering (IPO) was subscribed 52.59 times. The public show had a new show of up to ??600 crore and an offer to sell (OFS) of up to ??798.3 crores. The company had set a price range for the offering at ??780-796 per share. The proceeds from the new issue are intended to finance the working capital requirement of the company’s Optival subsidiary.
MedPlus was founded in 2006 by Gangadi Madhukar Reddy, Managing Director and CEO of the company. The Hyderabad-based pharmacy retailer offers a wide range of products including pharmaceutical and wellness products and FMCG products such as home and personal care items.
As of June 31, 2021, the company had a strong pharmacy network of 2,165 stores in Tamil Nadu, Andhra Pradesh, Telangana, Karnataka, Odisha, West Bengal and Maharashtra. Medplus was the first pharmacy retailer in India to offer an omnichannel platform and continues to grow its network of retail stores.
The opinions and recommendations expressed above are those of individual analysts or brokerage firms, not Mint.
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