Rakesh Jhunjhunwala's Rare Enterprises-backed IKS Health to File for IPO

The company has been aiming for a $350 million IPO, which is anticipated to be primarily an offer for sale by early angel investors and other shareholders, including Rare Enterprises.

IKS Health, a digital health platform backed by the late Rakesh Jhunjhunwala’s investment firm Rare Enterprises, has set foot to file draft papers with SEBI for an imminent initial public offering (IPO).

IKS Health is an operator of healthcare solutions, that helps hospitals better manage resources.

The company has been aiming for an INR 2.500 Cr IPO via the issuance of 15% equity.

Further, it is expected to be primarily an offer for sale (OFS) by early angel investors and other shareholders, including Rare Enterprises with no fresh issue. Moreover, to manage the issue, IKS Health has enlisted ICICI Securities, Nomura, Jefferies, JPMorgan, and JM Financial.

Rare Enterprises’ Stake in IKS Health

Rare Enterprises holds a nearly 54% stake in IKS Health. Its board members include Utpal Sheth, MD & CEO at Rare Enterprises as well as Amit Goela, Head Of Research & Investments at Rare Enterprises.

In August 2023, the company had considered an IPO to raise INR 2,500 Cr or about $300 million. However, IKS Health did not proceed with the plan at that time.

Over the next 60 days, the company expects to finalize and file draft papers for the IPO.

Following the unexpected demise of India’s esteemed investor and big bull, Rakesh Jhunjhunwala, it is speculated that his trusted associate and fellow prominent investor, Radhakishan Damani, may assume the role of main trustee for Rare Enterprises.

The management of Rare Enterprises is set to continue under the stewardship of Utpal Seth and Amit Goela, both trusted lieutenants of the late Jhunjhunwala.

Seth, who has been assisting Jhunjhunwala on the investment side, has primarily been focusing on private equity investments in recent years. Goela, Jhunjhunwala’s right-hand man on the trading side, has also been independently managing a trading book for the firm.

The firm reported a profit of INR 232.9 Cr on consolidated sales of INR 767.8 Cr for FY 2021-22

In November, IKS Health acquired US-based AQuity Solutions, a tech-enabled clinical documentation and revenue integrity solutions company.

The acquisition valued at $200 million (about INR 1,600 Cr) was financed partially through a INR 1,000 Cr loan from three major banks and the rest from internal funds.

The primary objective behind this acquisition was to bolster their workforce and resources. The aim was to recruit an additional 50,000 resources over three years, supplementing the current team strength of 14,000.

Founded in 2006 by Sachin K Gupta, IKS Health is a platform that offers health systems clinical, financial, and administrative solutions to improve operational efficiency, patient outcomes, optimized productivity, and revenue.

IKS Health's acquisition of AQuity Solutions aligns with its recent investments in technological advancements, including Abridge, a generative AI platform, and Sift Healthcare, a predictive analytics solution for revenue cycle management.