Medplus was founded in 2006 and is the second-largest pharmaceutical retailer in terms of the number of branches and sales or revenue. The company is planning to launch its IPO on December 13. The company plans to gain Rs.1,398.29 billion through its public issue. Let’s analyze the Medplus IPO.
About the brand –
The company offers pharmaceutical and health products such as Medicines, vitamins, medical devices, test kits. With that few fast-moving consumer goods like household and personal care products, baby care products, disinfectants, soaps, and detergents, etc. It is also the first pharmaceutical retailer in India to offer an Omnichannel* platform where customers buy products through the shop, order by phone, order online, and click and select.
Omnichannel- Omnichannel retail or omnichannel commerce is a concept of a multi-channel approach to sales. The main focus is on providing a seamless customer experience, whether customers are shopping online through a mobile device, laptop, or in a store.
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As of June 2021, the company has a strong pharmacy network with 2,165 branches in West Bengal, Karnataka, Maharashtra, Tamil Nadu, Telangana, Odisha, and Andhra Pradesh. It pursued a cluster-based approach to expand its branch network and initially opened stores in all areas in residential areas within its target market. Company warehouses are located in Bengaluru, Chennai, Hyderabad, Vijaywada, Kolkata, Pune, Bhubaneswar, Mumbai, and Nagpur.
Retail Revenue from the cities:-
| Chennai | 30% |
| Bangalore | 29% |
| Hyderabad | 30% |
| Kolkata | 22% |
Financials of Medplus
Medplus posted a profit of INR 63.11 Crore in 2021, a sharp increase from INR 1.79 Crore in 2020. Turnover increased from 2,870.6 crores to 3,069.26 crores during the same period.
| 30th Sep 21 | 31st Mar 21 | 31st Mar 20 | 31st Mar 19 | |
| Total Assets | 17,464.94 | 15,656.58 | 13,486.96 | 9,587.11 |
| Total Revenue | 18,908.99 | 30,908.14 | 28,878.87 | 22,849.40 |
| PAT | 663.67 | 631.11 | 17.94 | 119.22 |
Profit for the six-month period ending September 2021 was 66.36 rupees, an increase of 22.27 rupees. Also, the company’s revenue increased from 1,462.55 rupees to 1,879.92 rupees in the same period.
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Promoters
| Lavender Rose Investment | 24.58 percent stake |
| PI Opportunities Fund – I | 22.07 percent stake |
| Lone Furrow Investments | 15.42 percent stake |
| Agilemed Investments | 14 percent stake |
| Gangadi Madhukar Reddy | 13.74 percent stake |
Medplus’s Strengths
- The biggest strength I mentioned in the headline itself, Medplus is the Second-largest retail pharmaceutical company in India.
- The company has a strong pharmacy network in the retail sector with more than 2000 stores in Tamil Nadu, Andhra Pradesh, Telangana, Karnataka, Odisha, West Bengal, and Maharashtra.
- MedPlus is the first pharmaceutical retailer to offer an omnichannel platform to its customers. And omnichannel’s strategy mainly focuses on user experience.
- The company has a highly qualified, experienced, and professional management team.
- Medplus provides a Strong brand name and customer value.
Weaknesses
To talk about the weak point I need to point out the first thing is the “e-commerce issue”. It’s not about only Medplus, every other e-commerce company is facing the same,
- Limited availability of internet-Not every rural area has a good network connection.
- Lack of Awareness issue-In India most of the villagers still don’t know much about the internet, forget about online shopping.
- Weak online payment system- Even so many consumers today don’t feel safe to pay online for any products even for medicine as well. Though companies are pushing themselves in Cash-on-Delivery in order to build trust first.
- Physical stores- If you go outside of your home still not many areas have, these kinda offline stores, we can easily avail ourselves medicine from local stores.
Now, as I said this is the issue that every ecom company is facing in India. But when we are talking about the retail pharma sector Medplus is doing great as it’s the second largest. But the company has to increase their outlets and service to more areas in India to grow more and that won’t be easy as it has tough competitions. Whether the company wants to open more outlets- the main issue it will phase is, today in villages also medical stores are available. It will also become challenging for online delivery in n number of places in India.
Medplus IPO details
| IPO Opening Date | Dec 13, 2021 |
| IPO Closing Date | Dec 15, 2021 |
| Issue Type | Book Built Issue IPO |
| Face Value | ₹2 per equity share |
| IPO Price | ₹780 to ₹796 per equity share |
| Basis of Allotment Date | Dec 20, 2021 |
| Initiation of Refunds | Dec 21, 2021 |
| The credit of Shares to Demat Account | Dec 22, 2021 |
| IPO Listing Date | Dec 23, 2021 |
| Minimum 1 Lot or 18 shares | INR 14,328 |
| Maximum 13 Lot or 234 shares | INR 186,264 |
For more info, you can visit NSE
Conclusion
I hope above all the pieces of information will help you to decide whether this is your cup of cake or not. Let me know if you have any doubt regarding this in the comment section or in the social media handle. Good luck!!