NEPHROCARE HEALTH SERVICES LIMITED (NEPHROPLUS) IPO Explain

Nephrocare Health Services IPO Overview

Hyderabad-based dialysis chain (NephroPlus brand) raising ₹871.05 cr (₹353.40 cr fresh + ₹517.64 cr OFS). Price: ₹438-460. Lot: 32 shares (₹14,720 min).

Funds for new clinics (₹129.11 cr), debt repayment (₹136 cr.

Lead: ICICI, IIFL, Nomura, Ambit.

Asia’s largest, world’s 5th largest dialysis provider by treatments (FY25). 519 clinics (468 India + 51 international in Philippines, Uzbekistan, Nepal) across 328 cities. 5,068 machines. Largest dialysis facility globally (165 beds, Tashkent, Uzbekistan). 77% clinics in Tier-II/III cities

Competes with Fresenius, DaVita, Diaverum globally; regionally with Dr. Agarwal’s, Apex, DCDC.

IPO DETAILED INFORMATION

Issue Details

Parameter	Details
IPO Type	Mainboard
IPO Open Date	10 December 2025 (Tuesday)
IPO Close Date	12 December 2025 (Thursday)
Anchor Investor Bidding	09 December 2025 (Monday) – Completed
Allotment Date	15 December 2025 (Sunday) – Expected
Credit to Demat	16 December 2025 (Monday) – Expected
Refund Initiation	16 December 2025 (Monday) – Expected
Listing Date	17 December 2025 (Tuesday) – Tentative
Price Band	₹438 – ₹460 per share
Face Value	₹2 per share
Lot Size	32 shares (minimum lot)
Min Investment (Retail)	₹14,720 (32 shares at upper band ₹460)
sNII Investment	₹2,06,080 (14 lots / 448 shares) minimum
bNII Investment	₹10,00,960 (68 lots / 2,176 shares) minimum
Issue Size	₹871.05 crore total
Fresh Issue	₹353.40 crore (40.6%) – 76,82,609 shares
Offer for Sale (OFS)	₹517.64 crore (59.4%) – 1,12,53,210 shares by promoters & investors
Total Shares Offered	1,89,35,819 equity shares
Listing	BSE & NSE (Mainboard)
Post-Issue Market Cap	Estimated ₹4,615-4,700 crore (at upper price band ₹460)

Issue Break-up

Category	Allocation
QIB (Qualified Institutional Buyers)	50% of Net Offer
NII (Non-Institutional Investors)	15% of Net Offer
Retail Individual Investors	35% of Net Offer

Selling Shareholders (OFS ₹517.64 crore)

Promoters & Investors Selling 1,12,53,210 shares:

Promoters:

• Vikram Vuppala – Founder & Promoter

Institutional Investors (Major Exits):

• Bessemer Venture Partners Trust – Early-stage investor (Series A, 2014)
• Edoras Investment Holdings Pte. Ltd. – Investment entity
• Healthcare Parent Limited – Investment entity
• Investcorp Private Equity Fund II – Private equity investor
• Investcorp Growth Opportunity Fund – Growth equity investor

Note: OFS represents 59.4% of total issue – significant investor exits after 10-15 years of investments. Fresh issue at 40.6% (₹353.40 cr) for company growth.

Objects of the Issue (Fund Utilization)

Fresh Issue Proceeds (₹353.40 crore) will be used for:

1. Capital Expenditure for Opening New Dialysis Clinics in India – ₹129.11 crore (36.5%)
   • Setting up new dialysis clinics across India
   • Greenfield and brownfield clinic expansions
   • Infrastructure, medical equipment, dialysis machines for new centers
   • Expansion into underserved Tier-II and Tier-III cities
   • Strengthening presence in existing geographies
2. Prepayment or Scheduled Repayment of Borrowings – ₹136.00 crore (38.5%)
   • Full or partial repayment of bank loans and financial institution borrowings
   • Reduction of interest burden on P&L
   • Improving financial flexibility and credit profile
   • Strengthening debt-equity ratio
3. General Corporate Purposes – ₹88.29 crore (25.0%)
   • Working capital requirements
   • International expansion initiatives (Philippines, Uzbekistan, Nepal, Saudi Arabia JV)
   • Technology infrastructure and RenAssure protocol upgrades
   • Marketing and brand building initiatives
   • Strategic initiatives and contingencies

Strategic Focus:

• Aggressive network expansion adding new clinics to existing 519 base
• Debt reduction improving balance sheet health
• Geographic penetration deeper into Tier-II/III cities
• International footprint strengthening in Asia

OFS Proceeds (₹517.64 crore):

• Goes entirely to promoters and institutional investors (Bessemer, Investcorp, others)
• Provides liquidity and exits for early-stage investors after 10-15 years
• Promoter Vikram Vuppala partial exit

Note: OFS dominates at 59.4% indicating investor-exit focused IPO vs pure growth capital raise.

Lead Managers & Registrar

Book Running Lead Managers (BRLMs):

1. ICICI Securities Limited
2. Ambit Private Limited
3. IIFL Capital Services Limited
4. Nomura Financial Advisory & Securities (India) Private Limited

Registrar:

• Kfin Technologies Limited
  • Address: Selenium Tower-B, Plot 31 & 32, Gachibowli, Financial District, Nanakramguda, Hyderabad – 500032, Telangana
  • Phone: +91-40-6716 2222, +91-40-7961 1000
  • Email: [email protected]
  • Website: www.kfintech.com / https://ipostatus.kfintech.com/

Promoters & Management

Key Promoter:

Vikram Vuppala – Founder, Promoter & Key Management Personnel

• Founded Nephrocare Health Services (NephroPlus brand) in 2009
• Visionary leader building Asia’s largest dialysis network from single clinic to 519 clinics
• 15+ years of scaling operations across India and international markets
• Strategic leadership driving clinical excellence, PPP partnerships, technology innovation
• Partial OFS participant for liquidity after 15+ years

Institutional Promoters (Pre-IPO Investors):

1. Bessemer Venture Partners Trust – Series A investor (2014), long-term strategic partner
2. Edoras Investment Holdings Pte. Ltd. – Investment entity
3. Healthcare Parent Limited – Investment entity
4. Investcorp Private Equity Fund II – Growth equity investor
5. Investcorp Growth Opportunity Fund – Growth equity investor

Recent Pre-IPO Investors (Oct-Nov 2025):

• Urudavan Investment (acquired 3.6% stake)
• Abakkus Asset Manager
• Carnelian
• SBI General Insurance
• Sattva Developers

Company History:

• Incorporated: December 18, 2009 as Nephrocare Health Services Private Limited
• Converted to Public Company: June 18, 2025 (Nephrocare Health Services Limited)
• Brand: Operates under “NephroPlus” brand – patient-facing identity
• Vision: Build Asia’s most trusted dialysis care provider delivering protocol-driven clinical excellence
• Mission: Make quality dialysis accessible and affordable across India and beyond
• Growth Journey:
  • 2009: Single clinic inception
  • 2014: Bessemer Venture Partners Series A funding
  • 2016: Series C $15 million funding – expansion from 100 to 500 clinics target
  • 2019-2024: International expansion (Philippines, Uzbekistan, Nepal, Saudi Arabia JV)
  • 2025: 519 clinics, 5,068 machines, 3.30 million treatments (FY25), Asia’s largest

Company Contact:

• Registered Office: 5th Floor, D Block, iLabs Centre, Plot 18, Software Units Layout, Survey No. 64, Madhapur, Shaikpet, Hyderabad – 500081, Telangana, India
• Phone: +91 40 4240 8039
• Email: [email protected]
• Website: www.nephroplus.com

Certifications & Quality:

• RenAssure Clinical Protocol: ISO 9001:2015 certified protocol-led dialysis system covering all aspects of care
• Regularly updated with latest research, adapted country-wise for local needs
• NephroPlus Academy: Training facility for dialysis technicians and nurses

COMPANY OVERVIEW

Establishment & Background:

• Founded: December 18, 2009 (15+ years of operations)
• Brand: NephroPlus – patient-facing brand identity
• Industry: Dialysis Services – End-to-End Kidney Care
• Headquarters: Hyderabad, Telangana
• Positioning: Asia’s largest, world’s 5th largest dialysis provider by number of treatments performed (Fiscal 2025)

Business Model:

Dialysis Network – 519 Clinics Across 4 Countries, 328 Cities:

Geographic Footprint (as of September 30, 2025):

• 468 Clinics in India across 288 cities in 21 states & 4 union territories
  • 77% of clinics located in Tier-II and Tier-III cities (critical for accessibility)
  • Pan-India presence from metros to smaller towns
• 51 International Clinics across 3 countries:
  • Philippines – Growing network
  • Uzbekistan – Includes world’s largest dialysis facility (165 beds in Tashkent)
  • Nepal – Regional expansion
• Saudi Arabia: Joint venture entered in FY24 (nascent stage)

Clinic Models – Asset-Light Expansion Strategy:

1. Greenfield Clinics (80 clinics): Built from scratch, wholly owned infrastructure
2. Brownfield Clinics (259 clinics): Acquisition or partnership with existing facilities
3. PPP Clinics (180 clinics): Public-Private Partnership with government hospitals
   • Contributed 30.96% of H1FY26 revenue, 32.62% of FY25 revenue
   • Competitively bid contracts with government institutions

Captive Hospital Partnerships (Major Revenue Driver):

• 259 Captive Clinics within Private Hospitals (as of March 31, 2025)
• Partnerships with leading hospital chains:
  • Max Super Speciality Hospital
  • Fortis Escorts Hospitals
  • Care Hospitals
  • Wockhardt Hospitals
  • Paras Healthcare
  • The Calcutta Medical Research Institute (CMRI)
  • Jehangir Hospital
  • Ruby Hall Clinic
• Revenue Contribution: 43.30% of FY25, 36.51% of H1FY26
• Model: NephroPlus operates in-house dialysis centers within hospitals, revenue-sharing arrangements

Medical Infrastructure:

• 5,068 Dialysis Machines (as of March 31, 2025) – up from 4,714 (FY24), 3,662 (FY23)
• 3.30 Million Treatments Performed in FY25 (20.09% CAGR FY23-FY25)
• 33,000+ Patients Served Annually across network
• World’s Largest Dialysis Clinic: 165-bed facility in Tashkent, Uzbekistan

Service Offerings – Comprehensive Kidney Care:

1. Haemodialysis: Core dialysis treatment at clinics
2. Home Haemodialysis: Dialysis-at-home services for patient convenience
3. Hemodiafiltration: Advanced dialysis technique
4. Holiday Dialysis: Dialysis for traveling patients
5. Dialysis on Call: Emergency dialysis services
6. Dialysis on Wheels: Mobile dialysis units for remote areas
7. Wellness Programs: Patient education, diet plans, nutritional support
8. In-House Pharmacy: Medicines and consumables supply

RenAssure Clinical Protocol:

• ISO 9001:2015 Certified: Standardized protocol-led system covering all aspects of dialysis care
• Regularly updated with latest research and best practices
• Country-specific adaptations for local needs and regulations
• Ensures consistent quality across 519 clinics globally
• Focus on patient safety, infection control, treatment efficacy

Revenue Model:

• Patient dialysis sessions (majority revenue)
• Government PPP contracts (fixed per-session rates)
• Private hospital partnerships (revenue-sharing or per-session fees)
• Pharmacy sales and consumables
• Insurance and government scheme tie-ups (Ayushman Bharat, state health insurance)

Value Proposition:

• Protocol-Driven Excellence: RenAssure ensuring consistent quality
• Accessibility: 77% Tier-II/III presence bringing care closer to patients
• Affordability: Competitive pricing, government PPP contracts serving underserved
• Comprehensive Care: Diagnosis to dialysis to wellness – end-to-end kidney care
• Convenience: Home dialysis, holiday dialysis, dialysis-on-wheels options

Market Position:

• Asia’s Largest Dialysis Provider by number of clinics and treatments (FY25)
• World’s 5th Largest dialysis provider by number of treatments performed (Fiscal 2025 per Frost & Sullivan)
• 4.4X Larger than Nearest Indian Competitor by revenue (per Frost & Sullivan)
• 519 Clinics (468 India + 51 international) – largest network in Asia
• 328 Cities, 4 Countries – unmatched geographic reach in region
• Dominant Market Share in India: Estimated 15-20% of organized dialysis market

Operations:

Expansion Strategy:

• Asset-light model (greenfield, brownfield, PPP) enabling rapid scaling without heavy capex
• Focus on Tier-II/III cities where demand high but supply limited
• Hospital partnerships (captive clinics) providing captive patient flow
• International expansion into under-penetrated Asian markets (Philippines, Uzbekistan, Nepal, Saudi Arabia JV)

Debt Position:

• ₹136 crore allocated from IPO for debt repayment/prepayment
• Indicates moderate debt levels; exact outstanding not disclosed

Workforce:

• 1,487 employees (as of August 31, 2025)
• Includes nephrologists, dialysis technicians, nurses, support staff
• NephroPlus Academy for training and skill development

Company Strengths

1. Asia’s Largest, World’s 5th Largest Dialysis Provider – Unmatched Scale:

• Asia’s largest dialysis services provider by clinics, treatments, revenue (FY25)
• World’s 5th largest by number of dialysis treatments performed (3.30 million in FY25)
• 4.4X larger than nearest Indian competitor by revenue (per Frost & Sullivan) – dominant market share
• 519 clinics across 4 countries, 328 cities – geographic reach unparalleled in Asia
• World’s largest single dialysis facility (165 beds, Tashkent, Uzbekistan) demonstrating operational excellence at scale
• Scale advantages: Procurement efficiencies, standardized protocols, brand recognition, talent attraction

2. Exceptional Financial Performance – 34% Revenue, 91% PAT Growth (FY24-25):

• Revenue surged from ₹574.72 cr (FY24) to ₹769.92 cr (FY25) – 34% YoY growth
• Profit After Tax exploded from ₹35.13 cr (FY24) to ₹67.10 cr (FY25) – 91% YoY growth (nearly doubled)
• PAT margin of 8.7% (FY25) – healthy profitability for healthcare services sector
• Revenue CAGR (FY23-FY25): 34%+ – sustained high growth trajectory
• Treatment volume CAGR (FY23-FY25): 20.09% – strong demand validation
• Profitability demonstrates operational leverage as network scales

3. Protocol-Driven Clinical Excellence – RenAssure ISO 9001:2015 Certified:

• RenAssure Clinical Protocol: Comprehensive, standardized system covering all aspects of dialysis care
• ISO 9001:2015 certified ensuring international quality standards
• Regularly updated with latest nephrology research and global best practices
• Country-wise adaptations for local regulatory and clinical needs
• Ensures consistent quality across 519 clinics spanning 4 countries – critical for patient safety
• Differentiation vs smaller players with ad-hoc protocols
• Patient trust and outcomes: Standardization reduces variability, improves clinical results

4. Asset-Light Expansion Model – Greenfield (80), Brownfield (259), PPP (180):

• Three Expansion Pathways: Greenfield (new builds), brownfield (acquisitions/partnerships), PPP (government contracts)
• Asset-light strategy enables rapid scaling without massive capex requirements
• Flexibility to choose optimal model based on geography, market conditions, capital availability
• PPP clinics (180 units, 30.96% of H1FY26 revenue) provide stable government contracts with guaranteed patient volumes
• Captive hospital partnerships (259 clinics, 43.30% of FY25 revenue) leverage existing hospital patient flows – no marketing needed
• Capital efficiency: Lower capex per clinic vs wholly-owned greenfield model
• Risk mitigation: Diversified across ownership models reducing single-model dependency

5. Strong Tier-II/III City Presence – 77% of Clinics, High Growth Potential:

• 77% of clinics located in Tier-II and Tier-III cities – critical strategic positioning
• Tier-II/III advantages:
  • Lower competition vs metros (Delhi, Mumbai, Bengaluru saturated with dialysis centers)
  • Underserved patient populations with high unmet need
  • Government focus on healthcare accessibility in smaller towns – PPP contract opportunities
  • Lower real estate and operational costs vs metros
  • Patient loyalty stronger in smaller cities (limited alternatives)
• Demographic tailwinds: Tier-II/III cities experiencing rising incomes, healthcare awareness, chronic disease burden
• Scalability: Massive untapped market in thousands of small towns across India

6. International Expansion – Philippines, Uzbekistan, Nepal, Saudi Arabia JV:

• 51 International Clinics across Philippines, Uzbekistan, Nepal
• World’s Largest Dialysis Facility (165 beds, Tashkent, Uzbekistan): Demonstrates capability to execute mega-projects internationally
• Saudi Arabia Joint Venture (FY24): Entry into high-value Middle East market
• Geographic diversification reducing India-only dependency
• International markets less competitive, higher reimbursement rates (Uzbekistan, Saudi Arabia government contracts)
• Scalability: Asian markets (Bangladesh, Sri Lanka, Southeast Asia) offer growth runway

7. Industry Tailwinds – Rising Kidney Disease Burden, Government Support:

• India Dialysis Market: Projected to grow from $2.113 Bn (2022) to $4.368 Bn (2030) at 9.50% CAGR
• Chronic Kidney Disease (CKD) Epidemic: Rising prevalence driven by diabetes, hypertension, aging population
• Low Penetration: <30% of ESRD patients in India undergo dialysis due to cost, access barriers – massive untapped market
• Government Initiatives:
  • National Dialysis Services Program – setting up dialysis centers in underserved areas
  • Ayushman Bharat – free dialysis under PM-JAY scheme
  • State health insurance programs covering dialysis
  • PPP contracts providing guaranteed patient volumes and reimbursements
• Organized Sector Shift: Patients preferring certified, protocol-driven centers over unorganized small clinics – NephroPlus gaining market share

Key Risks & Challenges

1. Heavy OFS (59.4%) – Investor Exit Signal, Limited Fresh Capital:

• ₹517.64 cr (59.4%) OFS to promoter Vikram Vuppala and investors (Bessemer, Investcorp, others) vs ₹353.40 cr (40.6%) fresh capital
• Institutional investors (Bessemer 10-15 years invested, Investcorp) seeking exits – signals potential valuation peak concerns
• Promoter partial exit after 15 years – reduced skin-in-game post-IPO
• Limited fresh capital (₹353.40 cr) for ambitious clinic expansion vs massive network (519 clinics) requiring continuous capex
• Majority of IPO proceeds going to shareholders, not company growth – red flag for growth capital needs

2. High Dependency on Hospital Partnerships – 43.3% Revenue, Non-Renewal Risks:

• Captive Hospital Clinics: 259 clinics contributing 43.30% of FY25 revenue (highest single segment)
• Non-Renewal Risk: Partnerships with Max, Fortis, Care, Wockhardt subject to contract renewals; no long-term guarantees disclosed
• Cannibalization Risk: If hospitals develop in-house dialysis capabilities or switch to competitors, revenue loss
• Negotiating Leverage: Hospitals may demand better revenue-sharing terms during renewals, compressing margins
• Single Point Failures: Loss of single major hospital chain (e.g., Max, Fortis) could materially impact 5-10% of revenue
• Industry Pattern: Hospital partnerships often transactional with low switching costs

3. PPP Contract Dependency – 32.6% Revenue, Competitive Bidding, Payment Delays:

• PPP Clinics: 180 clinics contributing 30.96% (H1FY26), 32.62% (FY25) of revenue
• Competitive Bidding: Contracts awarded through tenders – no assured renewals; losing bids means clinic closure
• Pricing Pressure: Government contracts typically have lower per-session rates vs private; competitive bidding drives rates down
• Payment Delays: Government receivables often delayed 60-180 days – working capital strain
• Policy Risk: Changes in state/central health programs, budget cuts impact contract availability and terms
• Contract Duration: Typically 3-5 year contracts – medium-term revenue visibility, but renewal uncertain

4. Extremely High Nephrologist Attrition – 53.05% in FY25:

• Nephrologist Attrition Rate (FY25): 53.05% – more than half of kidney specialists left annually
• Critical Dependency: Nephrologists essential for clinical oversight, patient management, regulatory compliance
• Operational Disruption: High attrition disrupts patient care continuity, clinic operations, quality standards
• Talent Shortage: India faces acute shortage of nephrologists (4-5 per million population vs 40-50 in developed countries)
• Competition: Hospital chains, private practices offering higher compensation attracting talent
• Recruitment Costs: Continuous hiring, training, onboarding costs pressuring profitability
• Risk: If attrition continues, clinical quality and patient outcomes may suffer

5. Intense Competition from Global Giants & Regional Players:

Global Competitors (Entering/Present in India):

• Fresenius Medical Care (Germany): World’s largest dialysis provider, 3,700 centers globally, 299,000 patients, NephroCare brand (680 centers Europe/MEA/LatAm), massive scale and resources
• DaVita Inc. (USA): World’s 2nd largest, strong US presence, invested in Indian chains (Nephrolife), global expansion focus
• Diaverum (Global): Large international dialysis chain, potential India entry

Indian Competitors:

• Dr. Agarwal’s Healthcare Limited: Multi-specialty chain with dialysis services
• Apex Kidney Care: Regional dialysis provider
• Deep Chand Dialysis Center (DCDC): North India dialysis chain, Pragati India Fund-backed
• Sparsh Nephrocare: Acquired majority stake by Fresenius – now Fresenius’ India entry vehicle
• Narayana Health, Apollo Hospitals, Medanta, Manipal Hospitals: Large hospital chains with integrated dialysis departments

Competitive Pressures:

• NephroPlus’ ₹769.92 cr revenue vs Fresenius’ global $20+ billion – 1000X+ size gap (though Fresenius not fully in India yet)
• Global players have decades of R&D, technology, clinical protocols, capital for aggressive expansion
• Local hospitals expanding in-house dialysis reducing demand for third-party providers like NephroPlus
• Price competition from smaller regional chains and unorganized clinics
• Patient acquisition challenging in saturated metro markets

6. High Receivables & Working Capital Intensity – ₹290 Million Loss Allowance (FY25):

• Receivables Provision (FY25): ₹290.04 million provided as loss allowance – significant bad debts
• Working Capital Strain: Dialysis business involves upfront costs (consumables, salaries, utilities) with delayed reimbursements
• Government PPP Contracts: Payment cycles 60-180 days creating cash flow mismatches
• Insurance Reimbursements: Third-party payers (insurance companies, government schemes) delay payments
• Liquidity Risk: High receivables and working capital needs require continuous funding
• Cash Flow: Operating cash flows may lag P&L profitability due to working capital buildup

7. Regulatory & Compliance Risks – Healthcare Sector Scrutiny:

• Multi-Jurisdictional Compliance: Operating across 21 Indian states, 4 countries – multiple regulatory regimes
• Clinical Licensing: Dialysis centers require state health department licenses, biomedical waste permits, AERB clearances (if using radioactive substances)
• RenAssure Protocol Maintenance: ISO 9001:2015 certification requires continuous audits, updates, compliance
• Medical Negligence Litigation: Dialysis carries clinical risks (infections, access-related complications); lawsuits can result in damages, reputational harm
• Data Privacy: Patient medical records subject to strict confidentiality and data protection laws
• Government Policy Changes: Changes in Ayushman Bharat, state health insurance schemes impact reimbursement rates and patient volumes

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Disclaimer

This information is based on publicly available sources including SEBI DRHP/RHP filings, company disclosures, news reports, Frost & Sullivan reports, and industry research. Investors should conduct their own research and consult with financial advisors before making investment decisions.

Past performance is not indicative of future results. The company reported strong financial performance (FY25: 34% revenue growth, 91% PAT growth to ₹67.10 crore), is Asia’s largest and world’s 5th largest dialysis provider with 519 clinics and 5,068 machines, but faces significant risks including heavy OFS (59.4% of issue to investor/promoter exits vs 40.6% fresh capital), high dependency on hospital partnerships (43.3% of FY25 revenue subject to non-renewal risks), PPP contract dependency (32.6% revenue from competitively bid government contracts), extremely high nephrologist attrition rate (53.05% in FY25), intense competition from global giants (Fresenius, DaVita, Diaverum) and Indian players (Dr. Agarwal’s, Apex, DCDC, hospital chains), high receivables with ₹290 million loss allowance (FY25) indicating collection challenges, working capital intensity, and regulatory/compliance risks across 21 states and 4 countries. Investors must carefully review detailed hospital partnership terms, PPP contract renewal rates, nephrologist retention strategies, and working capital cycles in RHP before applying. Mainboard IPO investments carry market risks; read offer document carefully. Grey Market Premium (GMP) not yet active / not reported.