ABH Healthcare Limited, a multi-specialty tertiary care hospital operator based in Ferozepur, Punjab, has filed its Draft Red Herring Prospectus (DRHP) with the Securities and Exchange Board of India (SEBI). The company, which operates under the "Anil Baghi Hospital" brand, aims to list on the SME exchange to fund its growth trajectory and improve its balance sheet. With a strong revenue growth trajectory and expanding profitability, the IPO marks a significant step for this Tier 3 city healthcare provider.

Company Overview

ABH Healthcare Limited operates a 150-bed multi-specialty tertiary care hospital in Ferozepur, Punjab. Incorporated in March 2021, the company acquired the business of M/s. Anil Baghi Hospital in March 2022, which has been in operation since 1985. The facility offers 25 medical specialties, including cardiac sciences, neurology, minimally invasive surgeries, gastroenterology, and critical care.

The hospital is empanelled with over 30 insurance companies and major government schemes such as ECHS (Ex-Servicemen Contributory Health Scheme) and Ayushman Bharat. In FY2026, 61.94% of its revenue (₹3,161.46 Lakhs) came from government departments, insurance companies, and Third Party Administrators (TPAs). The management team includes U.S.-trained doctors, with Dr. Kamal Baghi serving as Managing Director and Dr. Saurabh Baghi as CEO.

Offer Details

The IPO is structured as a fresh issue with no Offer for Sale (OFS) component disclosed. While the specific price band and lot size are not yet available in the DRHP data, the timeline for the issue has been announced.

Objects of the Issue

The proceeds from the issue will be utilized for the following purposes:

• Repayment/Prepayment of Certain Borrowings: ₹17.00 Crores
• Funding Working Capital Requirements: ₹5.00 Crores
• Inorganic Growth & General Corporate Purposes: Subject to SEBI ICDR limits (amount not specified)

The debt repayment component aims to reduce the company's secured debt of ₹4,575.26 Lakhs (₹45.75 Cr) as of FY2026, thereby improving the debt-to-equity ratio.

Financial Highlights

ABH Healthcare has demonstrated robust financial growth over the last three fiscal years. Revenue from operations grew from ₹41.38 Cr in FY2024 to ₹52.51 Cr in FY2026. Profit After Tax (PAT) surged significantly, rising from ₹1.66 Cr in FY2024 to ₹5.64 Cr in FY2026.

The PAT margin expanded from 4.01% in FY2024 to 10.72% in FY2026. However, investors should note that revenue growth decelerated to 6.58% in FY2026 compared to 19.07% in FY2025. The debt-to-equity ratio improved from 5.69x in FY2024 to 3.20x in FY2026.

Risk Factors

Investors must consider the following material risks associated with the IPO:

• Geographic Concentration: 100% of revenue is derived from a single hospital location in Ferozepur, Punjab. Any adverse event at this facility could materially impact the entire business.
• Property Ownership Uncertainty: The company does not own its hospital premises. Block-1 ownership is disputed, with the Central Government recorded as the owner, creating potential eviction risk.
• High Doctor Attrition: The attrition rate for senior consulting doctors was 38.46% in FY2026, which poses a risk to service continuity and patient trust.
• Supplier Concentration: The top 2 suppliers accounted for 73.49% of total purchases in FY2026, indicating extreme supply chain dependency.
• Limited Operating History: As a corporate entity, ABH Healthcare has limited operating history since acquiring the business in March 2022, making future performance evaluation challenging.

Valuation & Peer Comparison

Specific valuation multiples such as P/E or P/B cannot be calculated as the price band is not yet disclosed. Investors are advised to compare the final offer price against listed healthcare peers like Narayana Hrudayalaya, Aster DM Healthcare, and SME peers like Yatharth Hospital once the RHP is finalized. The post-issue equity enhancement from fresh proceeds will likely improve the book value per share.

Bottom Line

ABH Healthcare Limited presents a case of a specialized healthcare provider in an underserved Tier 3 market with strong historical profitability improvements. The IPO offers a mechanism to deleverage the balance sheet significantly. However, the single-location revenue concentration, property ownership disputes, and high doctor attrition rates present substantial operational risks that investors must weigh carefully before applying.