Pharma Platform Entero Healthcare Files DRHP for IPO

Entero Healthcare Solutions,  an Indian pharma products distribution platform has filed its draft red herring prospectus (DRHP) with the capital markets regulator- Securities & Exchange Board of India (SEBI) to hit the bourses. 

The IPO comprises a fresh issuance of shares valued at INR 1,000 Cr by the company itself, accompanied by an offer for sale (OFS) of 85.57 Lakh equity shares by 19 selling shareholders. 

The primary purpose of the net fresh issue proceeds will be to repay debts amounting to INR 123.7 Cr and address long-term working capital needs totaling INR 600 Cr. The remaining funds will be allocated for inorganic growth initiatives through acquisitions and general corporate purposes.

Promoters Prabhat Agrawal, OrbiMed Asia III Mauritius, and Prem Sethi are among these selling shareholders.

OrbiMed Asia III Mauritius holds a 58.70% share in the company, making it a major stakeholder. Individual promoters Prabhat Agrawal and Prem Sethi possess 11.38% and 6.46% of the shares, respectively. 

Prasid Uno Family Trust is among the second-largest shareholders, represented by trustees Surbhi Singh and Universal Trustee, with a 20.04% stake.

Before finalising the red herring prospectus, Entero Healthcare Solutions was considering raising INR 200 Cr through private placement, preferential allotment, or rights issues. 

Established in 2018 in Faridabad by Prabhat Agrawal and Prem Sethi, Entero Healthcare operates as a pharmaceutical and medical device distributor, serving a customer base comprising retail pharmacies and hospitals.

With 73 warehouses across India and supply relationships with over 1,900 healthcare product manufacturers, Entero Healthcare Solutions offers over 64,500 stock-keeping units (SKUs). 

In FY22, the company generated revenues of INR 2,522.07 Cr, making it one of India's top three healthcare product distributors. Despite its impressive revenue figures, Entero Healthcare Solutions reported losses. 

In FY23, the company recorded a net loss of INR 11.1 Cr, an improvement from the previous year's loss of INR 29.44 Cr. 

The upcoming IPO is expected to provide the necessary capital to support the company's growth plans and manage its debt obligations effectively.