Gujarat Kidney & Super Speciality IPO: In-Depth Analysis & Review

The IPO of Gujarat Kidney & Super Speciality Ltd (GKSSL) received a strong response on its opening day, with the issue subscribed 1.47 times. Investors have two more days to apply, as the offer is set to close on December 24.

With the IPO closing soon, you may be wondering whether it's the right investment opportunity for you. Before you decide, explore our in-depth IPO analysis covering growth prospects, financials and potential red flags here.

Gujarat Kidney & Super Speciality IPO Details 

• Issue Details: Mainstream
• Fresh Issue: Rs 250.80 crore
• Price Band: Rs 108 – Rs 114
• Lot Size: 128 shares

Gujarat Kidney & Super Speciality: Business Overview

• GKSSL operates a multispecialty hospital and allied healthcare services chain in Gujarat, with a strong focus on kidney care and advanced specialty treatments. Its offerings span general medicine and super-specialty procedures, including internal medicine, general surgery, minimally invasive surgeries, orthopaedics and trauma care, joint replacement, obstetrics and gynaecology, respiratory care, non-interventional cardiology, diabetology and anaesthesiology.
• GKSSL currently operates 7 multispecialty hospitals along with 4 in-house pharmacies. The hospital network has a total bed capacity of 490 beds, with an approved capacity of 455 beds and an operational capacity of 340 beds.

Gujarat Kidney & Super Speciality Key Strengths

• Robust Growth: On a restated basis, revenue from operations increased by 743% in FY25, with EBITDA rising by 748% and net profit growing by 454% over FY24. Even on a proforma basis, revenue scaled meaningfully from Rs 85.79 crore in FY23 to Rs 119.97 crore in FY25, while PAT improved from Rs 6.35 crore to Rs 15.13 crore over the same period.
• Improving Margins: Operating profitability continues to strengthen. EBITDA margin improved from 40.86% in FY24 to 41.12% in FY25 and further expanded sharply to 56.52% in Q1FY26. Net profit margin, despite moderating to 23.61% in FY25, rebounded strongly to 35.41% in Q1FY26. On a proforma basis, PAT margin has shown steady expansion from 7.41% in FY23 to 12.61% in FY25 and further to 26.87% by Q1FY26.
• Strong Return Metrics: Return on Equity (ROE) improved from a negative (1.67%) in FY23 to 36.61% in FY25, while Return on Capital Employed (ROCE) rose from a negative (1.70) to 37.65% over the same period. Even on a proforma basis, the company reported robust ROE of 38.38% and ROCE of 35.88% as of FY25.

Gujarat Kidney & Super Speciality Risk Factors

• Geographic Concentration: GKSSL’s revenues are highly dependent on its Gujarat Kidney Hospital in Vadodara, with most facilities located in Central Gujarat. Any adverse economic, political or regional developments in this area could materially impact business performance.
• Execution Risk: The IPO proceeds are largely meant for acquisitions and capacity expansion. Delays in completing acquisitions, obtaining approvals or integrating operations could adversely affect growth plans and future performance.
• Bed Occupancy: The bed occupancy rate over the last three fiscal years has remained relatively low, ranging between 54% and 56%. Failure to improve or sustain adequate occupancy levels may restrict revenue generation, adversely impact operating efficiencies and negatively affect profitability.
• Limited History in Greenfield Projects: GKSSL has limited experience in executing greenfield hospital projects, which involve risks such as construction delays, cost overruns and regulatory challenges. These factors could impact timely project completion and financial outcomes.

Final Thoughts: Should You Subscribe to Gujarat Kidney & Super Speciality’s IPO?

• GKSSL has shown improvement in profitability metrics and a gradual reduction in leverage in recent years. These trends indicate better operational discipline and balance-sheet management, which is a positive sign.
• However, the primary concern lies in the utilisation of IPO proceeds, which is largely acquisition-driven. The company’s future performance will therefore be highly dependent on its ability to execute and integrate multiple acquisitions efficiently. Such strategies inherently carry elevated execution and integration risks, particularly for a relatively smaller healthcare platform like GKSSL.
• Valuation further weakens the investment case. Based on restated financials, the IPO is priced at ~61x earnings, significantly higher than most listed hospital peers. Even on proforma financials, the valuation remains demanding at roughly 39x P/E, which appears stretched considering the company’s size and execution risks. Any delays in integration, cost overruns or underperformance of acquired assets could significantly impact earnings and valuations.
• At the current pricing, the IPO offers limited scope for near-term upside. Given the unfavourable risk–reward balance, it would be prudent for investors to avoid the IPO at this stage and instead monitor execution progress and financial performance over the next few quarters before making an investment commitment. 

For a deep dive into other IPOs, explore: IPO Corner on Liquide