IPO closes on 12 Dec'25
Park Medi World Ltd
Minimum Investment
₹ 14,904 / 92 shares
Our Verdict:
Avoid
- Park Medi World Ltd (PMWL) has shown growth in its recent financials, with revenue and profitability metrics for FY25 indicating positive movement. However, there is noticeable fluctuation in earnings, and despite the growth, profits and margins for FY25 are still lower than those in FY23, pointing to inconsistencies in performance.
- A significant concern for PMWL is its dependence on government schemes, which has led to elongated working capital cycles due to payment delays and frequent claim rejections. Trade receivables have remained high, averaging over 150 days and stood at Rs 768 crore at the end of H1FY26, equating to about 50% of FY25's revenue. This presents a liquidity risk that could further affect the company's financial stability.
- On the positive side, the company's debt repayment plan, which involves using Rs 380 crore of IPO funds, is expected to improve earnings and net profit margins post-listing, providing some immediate relief.
- In terms of valuation, the IPO is attractively priced with a P/E ratio of 29x, significantly below the industry average. While this makes the IPO seem undervalued, it is largely justified by the volatility in earnings.
- The valuations position the IPO for potential listing gains, but these gains are uncertain and heavily dependent on broader market sentiment at the time of listing. Given the volatile conditions in the secondary market, it is advisable to avoid the issue at this stage as the risks currently outweigh the positives.
About the company
Founded in
20 Jan'11
Managing director
Dr. Ankit Gupta
- PMWL is the second-largest private hospital chain in North India and the largest in Haryana. With a presence across Haryana (8 hospitals), Delhi (1 hospital), Punjab (2 hospitals) and Rajasthan (2 hospitals), the hospital chain offers a wide range of 30+ super-specialty and specialty services, including internal medicine, neurology, urology, gastroenterology, orthopedics, oncology, cardiology and general surgery.
- PMWL employs 1,014 doctors and 2,142 nurses, supported by state-of-the-art medical infrastructure, which includes 870 ICU beds, 67 operating theatres, 2 dedicated cancer units, robotic-assisted surgery systems (iMARS), trauma centres and oxygen generation plants.
- PMWL is actively expanding with new projects in Ambala, Panchkula, Rohtak, Gorakhpur and New Delhi and expects to increase its bed capacity to 4,900 by March 2028.
STRENGTHS
- Strong Positioning: PMWL is the second-largest private hospital chain in North India, with a total bed capacity of 3,250, and the largest private hospital chain in Haryana, with 1,600 beds.
- Steady Growth: Revenue has grown consistently, rising from Rs 1,255 crore in FY23 to Rs 1,394 crore in FY25. While profits surged from Rs 152 crore in FY24 to Rs 213 crore in FY25, they remain below the FY23 figure of Rs 228 crore.
- Healthy Return Metrics: PMWL exhibits solid return ratios, with a Return on Equity (ROE) of 20.68% and a Return on Capital Employed (ROCE) of 17.47% in FY25, highlighting the company's efficient use of capital.
- Improving Margins: EBITDA margin has increased from 25.21% in FY24 to 26.71% in FY25, though it remains lower than the 31.11% in FY23. The net profit margin improved from 12.35% to 15.30% in FY25, and further to 17.21% by H1FY26, outperforming most of its listed peers.
RISK FACTORS
- Significant Contingent Liabilities: Contingent liabilities (excluding corporate guarantees) constitute 11.66% of its net worth, and corporate guarantees provided by the company and its subsidiaries account for 71.58% of the net worth. If these liabilities materialize, they may adversely affect the firm’s operations, cash flows and financial condition.
- High Attrition: PMWL is heavily reliant on doctors, nurses, medical professionals and support staff. As of FY25, the attrition rate for doctors was 38.36% and for Resident Medical Officers, it was as high as 58.29%. Failure to retain or attract skilled professionals could adversely impact the business, operations and financial health of the company.
- Revenue Concentration: A significant portion of PMWL’s revenue is derived from hospitals located in Haryana, comprising 69.06% of revenue in H1FY26 and 73.43% in FY25. Any adverse developments in Haryana, such as the floods in Punjab that briefly affected the operations in Ambala and Patiala in FY24, could negatively impact the company’s performance.
- Losses in Subsidiaries: Some of PMWL’s subsidiaries reported losses during H1FY26 and the last three fiscal years. Continued losses in these subsidiaries could hinder their operations and negatively affect the consolidated financial performance of PMWL.
- Decline in Bed Occupancy Rate: The bed occupancy rate at PMWL hospitals decreased from 75.13% in FY23 to 59.81% in FY24, with a slight recovery to 61.63% in FY25. If the company fails to maintain or increase occupancy rates at adequate levels, it may face challenges in generating sufficient returns on capital expenditure, potentially affecting profitability and operational efficiency.
- Legal & Regulatory Risks: PMWL, along with its subsidiaries, promoters, directors and key managerial personnel, is involved in certain legal and regulatory proceedings (including criminal cases) amounting to ~Rs 136 crore. Any adverse ruling in these matters may significantly impact the firm’s business, financial condition, cash flows and results of operations.
Financials
All Values are in Cr.
Issue details
Issue type
Mainstream
Issue size
₹ 920 crore
Fresh Issue
₹ 770 crore
OFS
₹ 150 crore
Price range
₹ 154 - 162
Lot size
92 shares
Issue Objective
The net proceeds from the fresh issue will be utilized for the following purposes:
- Repayment or prepayment of certain outstanding borrowings availed by the company and some of its subsidiaries;
- Development of new hospitals and expansion of existing hospitals by certain subsidiaries;
- Purchase of medical equipment by the company and certain subsidiaries; and
- Potential inorganic acquisitions and general corporate purposes.
Dates
Bidding open
10 Dec'25
Bidding close
12 Dec'25
Allotment date
15 Dec'25
Refund date
16 Dec'25
Listing
17 Dec'25
IPO Reservations
Qualified institutional buyers
<50%
Non-institutional investors
>15%
Retail individual investors
>35%
Read the Offer Document
© 2025 by Liquide Solutions Private Limited, SEBI Registered Research Analyst (Registration number - INH000009816)
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