Medplus Health dips below issue price, hits new low; stock down 16% in 1 wk

With the recent decline in the stock price of the company, MHSL is trading 7 per cent lower from its issue price of Rs 796 per share

Shares of Medplus Health Services (MHSL) hit a new low of Rs 737.15, down 4 per cent on the BSE in Friday’s intra-day trade. The stock of pharmacy retail company, which has fallen below its issue price of Rs 796 per share, was trading lower for the sixth straight day, down 16 per cent during the period.

With the recent decline in the stock price of the company, MHSL was trading 7 per cent lower from its issue price. It has tanked 45 per cent from its 52-week high level of Rs 1,343 touched on January 20, 2022. The company had made a stock market debut on December 23, 2021.

MHSL offers a wide range of products, including pharmaceutical and wellness products, including medicines, vitamins, medical devices, and test kits, and fast-moving consumer goods, such as home and personal care products, including toiletries, baby care products, soaps and detergents, and sanitizers.

For January-March quarter (Q4FY22), MHSL reported 36.8 per cent year on year (YoY) decline in profit after tax (PAT) at Rs 11.43 crore as against Rs 18.08 crore in Q4FY21. Earnings before interest, taxes, depreciation, and amortization (ebitda) margin contracted 120 bps YoY and 60 bps sequentially to 6.8 per cent during the quarter. Revenue, however, grew 19.9 per cent to Rs 966 crore from Rs 806 crore in the year-ago quarter.

MHSL said, currently, 27 per cent of the company’s stores are less than a year old. They, the company said, are expected to contribute to profit as they mature. The management also expects to maintain pace of new store openings.

That said, the potential aggressive discounting by peers is key risk for the company.