Nureca IPO Review – 3 Important Things You Should Know Before Applying IPO

  • Post last modified:February 25, 2021
  • Post category:Stock Market
  • Reading time:13 mins read
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Nureca IPO is scheduled to launch on Monday, 15 February 2021, for subscription to retail clients. The company is looking to raise Rs 100 crore through public issue to fund it’s incremental working capital and other corporate endeavors. Nureca raised Rs 44.55 crore from two anchor investors on Friday, February 12, 2021.

Nureca Limited IPO is 6th IPO getting opened for subscription in 2021 after IRFC IPO, Indigo Paints IPO, HFFC IPO, Stovekraft IPO & Brookfield India IPO.

According to a BSE circular, Nexpact Ltd invested Rs 34.55 crore against 8.63 lakh equity shares which is 77.55 % of the anchor investor portion. Next Orbit Ventures Fund invested Rs 10 crore for 2.50 lakh equity shares which comprise 22.45 % of the anchor investor portion. No trades were seen in the grey market (GMP) for Nureca Ltd as the issue size is Rs 100 crore only.

Nureca IPO will close for subscription on February 17, 2021. The Nureca IPO issue will be sold in the price band of Rs 396-400 per share and the minimum lot quantity is 35 shares and in multiples thereof.

I would like to add here that many people said to avoid Stovekraft IPO before it’s launch, however the current share price is trading at Rs.508 above the pre-open IPO price band of Rs.384. Likewise for Nureca IPO similar things are been seen on the other hand for IRFC IPO many people recommended a BUY but unfortunately it open at a discount price and is currently trading at Rs.25.40. 

Here is the thing no one can tell you whether the IPO will going to make a stellar debut or not, it is you who have to decide based on available information about the company. Moreover the IPO’s now a days are very hot market every one wants to earn some quick money on listing day itself and there is nothing wrong about it.

Having said that, one must not forget to check the financials and do not fall for any recommendation from anyone, it is you hard earned money, you should decide whether to opt for the IPO or not. Therefore, whenever you are buying IPO make sure the money invested is not the one which you my need it urgently, always use extra money which you may not require in near future.

Now, coming back to the Nureca IPO let us talk about in brief about the company and its financials and other details step by step.

 

About Nureca Limited: 

Nureca Limited entered the India market 4 years ago, i.e. In 2016, a time when the market was flooded with many products in the Home Health market premium companies brought good products but with outdated technology; smaller players, both local and Chinese, were bringing in generic and low-quality products Nureca identified and targeted the opportunity to address the need for innovative products but with high quality at reasonable premium, and are showing a significant growth due to the impressive response from the market.

Nureca Limited is into Healthcare and Wellness products distribution. It aims to offer the best quality, durable, and innovative tools to customers to monitor the chronic diseases.

The firm has a well diversified product portfolio that includes chronic device products, orthopedic products, mother and child products, nutrition supplements and more.

They sell their innovative products through their brand portfolios –Dr Trust, Trumom and Dr Physio. Currently, 95% of revenues for Nureca come through digital channels (eCommerce) such as Amazon, Flipkart etc.

However, this poses an opportunity for Nureca to expand into the offline channel. This would provide significant impetus to their growth, and build their brand value as well. To expand their business footprint, Nureca, in October 2019, joined hands with Croma, India’s first omni-channel electronics retailer from the Tata Group, to emerge as the very first company to sell healthcare and wellness products through Croma stores.

As part of this tie-up, Nureca will sell products from its Dr Trust and Dr Physio brands at 30 Croma stores across the country, and this would grow with the increasing adoption of the products.

The company believes in innovation and catering new products to the ever-growing needs of the home healthcare sector. The company is digital-first, wherein it sell its products through online channel partners such as e-commerce players, distributors and retailers.

Further, it also sells its products through its own website drtrust.in. The company’s products portfolio is classified under the following five categories:

  1. Chronic Device Products – Includes products like blood pressure monitors, pulse oximeters, thermometers, nebulizers, self-monitoring glucose devices, humidifiers and steamers.
  2. Orthopaedic Products – Includes rehabilitation products like wheelchairs, walkers, lumbar and tailbone supports and physiotherapy electric massagers.
  3. Mother and Child Products – Includes products like breast pumps, bottle sterilizers, bottle warmers, car seats and baby carry cots.
  4. Nutrition Supplements – Includes products like fish oil, multivitamins, probiotics, botin, apple cider and vinegar.
  5. Lifestyle Products – Includes products like smart scales, aroma diffusers and fitness trackers.

 

The overall eCommerce adoption in India Home Health market was 25.3% in 2019. While the overall adoption has been increasing over the years, the COVID 19 pandemic has “encouraged” the consumers towards online purchases and pushed growth in this channel during the lockdown restriction period.

The company’s management includes Smita Goyal, Ruchita Agarwal, Charu Singh, Vijay Kumar Sharma, Rajinder Sharma, Saurabh Goyal, Saurabh Goyal.

Let us now move on to understand a bit about the financials of Nureca Limited. 

 



 

Financials Of Nureca Limited:

Nureca IPO is valued at 5.6x annualized earnings report in 1HFY21, which looks to be attractively valued given high asset turnover and return ratio of the company. Talking about the the P/E valuation, on the upper end of the price band of Rs 400, the stock is priced at pre issue (Price to earning) P/E of 46.91x on its FY20 EPS (Earning per share) of Rs 8.53.

 

Financials Of Nureca Limited
Source: RHP

 

Post issue, the stock is priced at a P/E of 62.55x on its EPS of Rs 6.40. Looking at the (Price to book) P/B ratio at Rs 400 the stock is priced at a P/B ratio of 5.81x on the pre issue book value of Rs 68.86 and on the post issue book value of Rs 187.83 the P/B comes out to 2.13x. While on the lower end of the price band of Rs 396 the stock is priced at pre issue P/E of 46.44x on its FY20 EPS of Rs 8.53.

In last three years the total income of the company showed growth at a CAGR of 70.51%. The assets of the company grew at a CAGR of 69%. Moreover the profitability of the company, Nureca has steadily increased its profits with a CAGR of 27.20% whereas EBITDA and PAT is at 5.7x in 1HFY21. 

In the latest quarter, company has reported Gross Sales of Rs. 1057.06 Cr and Total Income of Rs.1017.87 Cr. As of now there are no peers in this segment so we cannot make any comparison for peers for Nureca limited. Let us now checkout the Nureca IPO details.

 

Nureca IPO Details:

 

Nureca IPO Details:

 

Objects of the Issue:

Meeting the working capital requirements of the business
Meeting general corporate purposes

 



 

Frequently Asked Question (FAQ):

1.What Is The Symbol For Nureca Limited?

Ans: The Symbol for Nureca limited is NURECA.

2.When Nureca IPO Coming?

Ans: The Issue Period for Nureca IPO is 15-Feb-2021 to 17-Feb-2021.

3. Post Modification Period For Nureca IPO?

Ans: The Post issue Modification Period for IPO is 18-Feb-2021 (10.00 A.M. to 11.00 A.M.).

4. What Is The Cut-off Time Period For UPI Mandate For Nureca IPO?

Ans: The Cut-off time for UPI Mandate Confirmation is 18-Feb-2021 (upto 12:00 PM).

5. What Is The Issue Type For Nureca IPO?

Ans: The Issue Type is 100% Book Building.

6.What Is The Price Band For Nureca IPO?

Ans: The Price (Band) Range for Nureca IPO is Rs.396 to Rs. 400 per equity share.

7. What Is The Lot Size For Nureca IPO?

Ans: The Bid Lot i.e. Minimum Order Quantity (lot size) for Nureca IPO is of 35 Equity Shares and in multiples thereof 35 Equity Shares.

8. Who Are The Book Running Lead Managers For Nureca IPO?

Ans: The Book Running Lead Managers are, ITI Capital Limited

9. What Is The Face Value For Nureca IPO?

Ans: The Face Value is of Rs. 10 whereas The Tick Size is of Rs.1

10. What Is The IPO Market Timings For Nureca IPO?

Ans: The IPO Market Timings is 10.00 a.m. to 5.00 p.m.

 

Apart from above points:

The Maximum Subscription Amount for Retail Investor is Rs. 2,00,000

The Maximum Subscription Amount for Eligible Employee Rs. 5,00,000

The Maximum Bid Quantity for QIB Investors 13,74,975 equity shares in multiple of 35 Equity Shares

The Maximum Bid Quantity for NIB Investors 6,24,995 Equity Shares in multiple of 35 Equity Shares

The Name of the Registrar Link time India Private Limited

The Address of the Registrar C-101, 1st floor, 247 Park, L.B.S. Marg, Vikhroli (West) Mumbai 400 083, Maharashtra, India

The Contact person name number and Email id Shanti is Gopalkrishnan, +91 22 4918 6200, [email protected]

 



 

Where To Check Nureca IPO Application And Allotment Status?

As an investor or trader generally we are curious and anxious to know the results of the application as soon as possible. To ease the anxiety, both Bombay Stock Exchange (BSE) and National Stock Exchange (NSE) have come up with dedicated pages and links which investors can use.

NSE

The NSE has an IPO bid verification module. It can be used to verify the IPO application details uploaded on the exchange bidding system by your member/bank. The data of the bid details uploaded by the member/bank would be available on T+1 day (where T would be date receipt of bid on NSE platform).

In addition, the data would be available until six days after the issue closure date. This gives the investor enough time to verify the data and instruct the member/bank to make any changes, if required.

Exchange will also provide allotment information as provided by the registrar to the issue.

An investor can avail this facility by registering using his/her PAN details. After registration, the investor will receive an email notification from NSE on the registered email address. That email will provide the login details.

The following link can be used for the same:

https://www.nseindia.com/products/dynaContent/equities/ipos/ipo_login.jsp

BSE

The BSE has also come up with a similar platform.

This unique facility allows investors to verify the status of their application submitted to a Trading Member or a SCSB (Self-Certified Schedule Banks).

The investor can check his application status/information on the website until one week after issue close.

The following link can be used by investors:

https://www.bseindia.com/investors/appli_check.aspx

 

Important Things To Keep In Mind Before Applying For IPO’s:

  • Try to fill for the same IPO online from different DP ID i.e. if in your family have more than 1 account you can possibly get the allocation done in case of over subscription.
  • You should have a good knowledge of the sector and the company you are planning to invest.
  • Analysis of the company’s balance sheet is very crucial. A clear understanding of the company’s future projects and vision is very necessary to know whether it will have a sustainable future.
  • Investment decision has to be taken carefully and not in a hurry.
  • Read as much as you can about the company, its objectives for launching the IPO, its past history in business and its futures prospectus.
  • Don’t go for hype in the news, your analysis should be based on facts rather than gossips and rumors.
  • Many IPOs are oversubscribed. What this means is that the demand for shares is much higher than the shares available for sale. In such a situation, it is no surprise that many investors fail to get any shares allotted to them. This is why it is advisable to apply for IPO shares on the last day of bidding. This way, one can have a good estimate on how large the subscription will be. Also, in that case, one should bid for just one lot and not unnecessarily lock up their capital.

 



 

Conclusion:

Nureca recent performance reflects that the company has received a benefit from COVID-19 pandemic situation. But as the situation is normalising, such performance is difficult to sustain. Having said that, if you look at the below graph showing the overall digital sales in different healthcare products in comparison to hospitals or pharmacies it has increased overtime.

 

Nureca IPO Review - 3 Important Things You Should Know Before Applying IPO
Source: RHP

 

 

If we talk about some of the weakness of the Nureca limited:

  • Nureca depend on third parties to manufacture their products. If these organizations are unable or unwilling to manufacture Nureca products, or if these organizations fail to comply with FDA or other applicable regulations there business will be harmed.
  • Nureca depend heavily on it’s channel partners such as third party e-commerce players, distributors and retailers and failure to manage the distribution network efficiently will adversely affect their performance.
  • They have a limited operating and financial history, which makes it difficult to accurately assess it’s future growth prospects.
  • Nureca are subject to stringent domestic and foreign applicable regulation and any adverse regulatory action may materially adversely affect their financial condition and business operations.

Let us look ate some of the strengths of Nureca Limited:

  • Strong portfolio of Nureca products and consistent focus on quality and innovation will pave a better future for them
  • The Asset light business model and competitive products
  • Combination of technical expertise and understanding of Indian consumer preference
  • Experienced Promoter with strong senior management team having domain knowledge

Therefore, it is always advisable to go through Nureca IPO – DRHP to know in detail about the company.

 



 

The only thing which should be bothering you is the research you did before applying for the IPO. Investing in IPO is risky as well as profitable. Having said that you also need to keep in mind important things mentioned above before applying to IPO’s as the risk is always involved.

For More Information Do Checkout Basics of IPO and FAQ Here.

Do Checkout 2020 IPO Performance List – Despite Corona Most IPO Listed Gave Positive Returns!!

Checkout the List Of 5 Best Stock Brokers In India 2021 here

Want to know how much you need to save to reach a specific target than do check moneycontain monthly savings goal calculator here.

Learn Technical Analysis In Stock Market For Beginners here

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Note: Please do your own research and make investment. Moneycontain will not be responsible for any of your losses at all. The point made is for educational purpose only and intended to give information. All investments are subject to risks, which should be considered prior to making any investments. The above details are compiled from information available on public platforms. These are not buy or sell recommendations.

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