Eye care service provider Centre For Sight Private Limited has filed draft red herring prospectus with the Securities and Exchange Board of India (SEBI) for its initial public offering (IPO). In its IPO papers, the New Delhi-based company said the public issue will involve a fresh issue of shares worth INR1.15 billion while also offering an exit route to existing shareholders through an offer for sale (OFS) of 2.54 million shares. The issue will be handled by Axis Capital and ICICI Securities.
Centre For Sight IPO may be preceded by a private placement of up to 1.09 million shares. The pre-IPO placement remains at the discretion of the company. If the company goes ahead with the pre-IPO placement, the IPO size will be reduced to the same extent.
Out of the 2.54 million shares under the OFS, 1.5 million shares will be offered by private equity player Matrix Partners. Company promoters Dr. Mahipal Singh Sachdev and Dr. Alka Sachdev are also expected to offload 952,857 and 50,000 shares, respectively. Thanks to its investments since 2010, Matrix Partners holds a 23.2% shareholding in the company while the rest is owned by company promoters.
Objects of the IPO
Centre For Sight stands to get nothing from the OFS portion while the issuance of fresh shares is expected to yield INR1.15 billion. The company intends to use the proceeds towards business expansion, setting up new facilities, and repayment of business loans. The biggest chunk of INR286.9 million is earmarked for purchase of shares from the other existing shareholders of CFS Netralaya. Nearly INR260 million will be used for establishment of six new eye care centres while INR196 million will go pre-payment of borrowings. Construction and establishment of the super-specialty eye care centre in Dwarka will entail INR165 million.
Humble beginning of Centre for Sight
Starting from a single eye care centre in New Delhi in 1996, Dr. Mahipal Singh Sachdev has transformed Centre for Sight into a network of 51 centres across 30 cities in the country as on September 2015. The company posted top line of INR1.5 billion in the latest fiscal year ended March 2015 while profits stood at INR26 million. Both figures indicated an improvement from previous year.