Medical equipment manufacturer Airox Technologies has filed preliminary papers with capital markets regulator Sebi to raise Rs 750 crore through an initial public offering (IPO). The IPO is entirely an offer-for-sale (OFS) of equity shares by promoters — Sanjay Bharatkumar Jaiswal and Ashima Sanjay Jaiswal, according to the draft red herring prospectus (DRHP).
Under the OFS, Sanjay and Ashima will offload equity shares worth Rs 525 crore and Rs 225 crore respectively. Airox Technologies, manufacturer of (Pressure swing adsorption) oxygen generator, has a market share of 50-55 per cent, in terms of operational private hospital PSA medical oxygen market, as of fiscal 2022, according to the draft papers.
The company facilitates the penetration of on-premise PSA (Pressure swing adsorption) oxygen generators in Indian hospitals with nearly 872 installed and operational PSA oxygen generators, as of March 2022. PSA oxygen generators are the equipment that produce oxygen with purity using adsorbents to remove nitrogen gas from the air. These equipment provide a stable supply of oxygen at a lower cost than other traditional medical oxygen procurement methods.
Demand for medical oxygen is expected to grow at a Compound Annual Growth Rate (CAGR) of 7-8 per cent from fiscal 2020 to fiscal 2027 in terms of volume, the draft papers said citing a Crisil report. Over 80 per cent of the hospitals in India procure medical oxygen through cylinders. More than half of the demand of medical oxygen is expected to be met through PSA method by fiscal 2027, it added. JM Financial and ICICI Securities are the book running lead managers to the issue.