Paras Healthcare Launches 1450 Crore IPO to Cut Debt and Fund Expansion

IPO Details

Paras Healthcare has opened its initial public offering to raise 1,450 crore rupees, with shares priced between 660 and 693 rupees apiece. The share sale includes a fresh issue of 500 crore rupees and an offer for sale of 950 crore rupees by existing investors. The company plans to use 375 crore rupees from the fresh issue to clear borrowings at the firm and its Srinagar subsidiary. Group chief financial officer Dilip Bidani noted that this debt reduction will leave the firm with minimal net bank debt.

Financial Turnaround

The hospital chain operates eight facilities across North India, Bihar, and Jharkhand with 2,211 planned beds, of which 1,502 were operational by June. Revenue grew at a compound annual rate of 19.3% from 1,129 crore rupees in fiscal 2024 to 1,606 crore rupees in fiscal 2026. The firm posted a net profit of 44 crore rupees in fiscal 2026, recovering from losses of 15 crore rupees in fiscal 2024 and 58 crore rupees in fiscal 2025. Managing director Dharminder Nagar stated that rising patient volumes drove this recovery.

Operational Performance

Occupancy rates rose from 50.8% in fiscal 2025 to 61.8% in fiscal 2026, reaching 69.7% in the June quarter. For the June quarter, revenue increased 27.7% year-on-year to 470 crore rupees, while earnings before interest, tax, depreciation, and amortization surged 71.1% to 113 crore rupees. However, quarterly earnings included a 16.2 crore rupee deferred tax credit.

Growth and Challenges

Government-backed healthcare schemes generated 41.3% of fiscal 2026 revenue compared to 29.8% in fiscal 2024, causing receivable days to increase from 46.4 to 66.4 and reach 76.3 in the June quarter. Nagar explained that this friction stems from new hospital empanelments in Kanpur and Srinagar. Meanwhile, Paras plans to add 300 beds in Gurugram and up to 500 in Ludhiana, aiming for a total capacity of 3,011 beds by March 2028.

Context

Healthcare operators in India frequently use public equity markets to fund capital-intensive hospital expansions and reduce debt burdens. Managing high capacity utilization is critical for turning operational beds into sustained profitability in the competitive domestic healthcare sector.