MedPlus Health Services shares jump 38% on issue price to Rs 1100; what should investors do with this scrip now?

The shares of MedPlus Health Services Limited were trading with 8 per cent gain on the listing price to Rs 1100 per share in the BSE intraday trade on Thursday. Overall, shares of India's second-largest pharmacy retail chain surged 38.19% against its issue price and 8.37% on listing price on the BSE around 11.25 am on Thursday. Shares gained Rs 85 on the listing price of Rs 1015 and Rs 304 against the issue price of Rs 796.  

Earlier, the listing of Shares of MedPlus Health Services Limited was in line with the Zee Business Managing Editor Anil Singhvi's prediction. Singhvi had expected a reasonable listing for the IPO of the health services provider. "Expected to list in 925-1000 range against issue price of Rs 796," he said.  

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At 9.30 am, the pre-open indicative price on the BSE showed shares trading at 15.20% or Rs 121 per share discount to Rs 675. The price of the shares soon reversed as shares gained by Rs 154.00 or 19.35% to trade at 950 per share.  

MedPlus Health Services market capitalisation too gained Rs 1024 crore as m-cap of the pharma retail company surged to Rs 13,134.36 crore against Rs 12,109.53 crore during the listing.  
As the shares have made strong listing and have continued their upward journey hitting a new 52-week high value of Rs 1,119.95, stock market experts explain what should investors do now.

Santosh Meena, Head of Research, Swastika Investmart Ltd.  
The IPO was subscribed 52 times and debuted at Rs 1040 per share on the NSE as opposed to the issue price of Rs 796, a 30% premium. Long-term investors should hold the stock as it might turn into a wealth creator in the next 2-3 years. However, short-term investors are advised to keep a stop loss of Rs 875. MedPlus has an omnichannel platform and is the second-largest pharmacy retailer. We believe the growth opportunities from the industry will justify the company's valuation in the long run, even if it appeared to be expensive at first glance.

Akhilesh Jat, Pharma Analyst at CapitalVia Global Research

Medplus Health Services is India's second-largest pharmacy retailer in terms of the number of stores and revenue. Despite being the second-largest pharmacy retailer, their presence in India is more limited to southern parts of India and that has been the biggest drawback for the company. We can expect a small correction of 10-15% in the stock prices keeping in mind the volatility in the market. In the long run, we expect that the company will grow constantly with the expansion of stores around the country.

Yash Gupta, Equity Research Analyst, Angel One Ltd 

We recommend to book profit in Medplus Health Services Limited IPO. Based on H1FY2022 numbers, the company is trading at EV/EBITDA of 37 times and price to sale of  3.4 times. We believe that all the short-term positives have been priced in. Hence, we recommend to book profit in Medplus Health Services Limited IPO at ₹1100. We have given a subscribe rating to the IPO.

Earlier, the initial public offer (IPO) of MedPlus Health Services Limited was subscribed 52.59 times on the final day of the issue on December 15.

The offer of the second-largest Pharmacy retail chain in India comprised a fresh issue of up to Rs 600 crore and an offer for sale (OFS) of up to Rs 798.29 crore.