MedPlus Health Services share price surged further to a new intraday high of Rs 1,133 apiece on Thursday, after making a stellar debut on stock exchanges. The stocks rose 11.6 per cent from the listing price, and a massive 42.3 per cent from the IPO price. Shares of pharmacy retailer got listed at 27.5 per cent premium to the IPO price. The stock commenced trading at Rs 1,015 apiece, as against the IPO price of Rs 796 per share. The company is into the organised pharmacy retail market in India.
In FY21, the penetration of the organised pharmacy retail market at a pan-India level was estimated at around 11%, which is low as compared to the penetration in developed economics and in China, an analyst said. “Thus there is immense growth potential in the organized pharmacy market. MedPlus, being the second largest pharmacy retailer, is expected to benefit from the expansion in the market,” Rajnath Yadav, Research Analyst, Choice Broking, said.
What should MedPlus Health Services investors do now?
Yadav advised short term investors to take an exit, while he suggested long-term investors to remain invested. In traded volume terms, a total of 10.92 lakh shares have been traded so far on BSE, and over 1.50 crore shares exchanged hands on the NSE.
Analysts at research and brokerage firm Angel One suggested short-term investors to book profit in Medplus Health Services, as the company was trading at EV/EBITDA of 37 times based on H1FY2022, in line with listed peers. “Long term investors can wait for lower levels to buy, as MedPlus is the second-largest pharmacy retailer in India. The company offers a good value proposition to its customer in terms of discount, a wide range of product and fast delivery,” Yash Gupta, Equity Research Analyst, Angel One, said. Gupta also believes that the company’s omnichannel platform will help to deliver strong growth in future. “So, we recommend short term investors to book profit and long term investors can wait for lower levels to buy,” he added.
The initial public offering of pharmacy retail chain MedPlus Health Services was subscribed 52.59 times. Santosh Meena, Head of Research, Swastika Investmart, advised long-term investors to hold the stock which might turn into a wealth creator in the next 2-3 years. For short-term investors, Meena suggested keeping a stop loss of Rs 875. “We believe the growth opportunities from the industry will justify the company’s valuation in the long run, even if it appears to be expensive at first glance,” Meena said.
MedPlus Health Services offers a wide range of products, including pharmaceutical and wellness products such as medicines, vitamins, medical devices and test kits. Following a stellar debut on D-Street, Ravi Singh, VP & Head of Research, ShareIndia Securities advised investors to book a 50 per cent position at current price and hold the remaining shares with a stop loss of Rs 1000.
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