Response Plus Holding soars 2,000% on Abu Dhabi market debut
ROSTER OF TOP CONTRACTS MAKES COMPANY ATTRACTIVE FOR INVESTORS
Shares of Response Plus Holding, which listed on the Abu Dhabi’s exchange’s ‘second market’ yesterday, rose 2,000 per cent in the first hours of trading — giving it a market cap of Dh4 billion.
With a share capital of Dh200 million, RPH had filed its prospectus with ADX for listing. The Abu Dhabi health services firm is an exciting company for UAE investors.
It provides efficient and comprehensive primary and secondary health care solutions at remote locations for medical and non-medical organisations, as well as operate medical facilities and critical care units. Its customers are in the oil and gas industries, construction sites, educational institutions, airports, and seaports in the GCC, with marquee clients being Emirates Global Aluminium, Adnoc, NMDC, Schlumberger, Hyundai, and Samsung Engineering.
What sets apart the company from its rivals is its management, with Dr. Shamsheer Vayalil Parambath holding 49 per cent, Alpha Dhabi Health has a stake of 36 per cent, while Chimera Investment owns 10 pe rcent. Dr. Vayalil is Chairman and Managing Director of VPS Healthcare, which has 24 hospitals, over 125 health centres, more than 13,000 employees, and one of the largest pharmaceutical manufacturing plants in the UAE. Alpha Dhabi is a subsidiary of International Holdings Co, the mega private investment firm.
Good connections
Response Plus manages more than 260 site clinics and operates the largest private fleet of ambulances in Abu Dhabi. This gives the firm the competitive advantage of responding immediately to emergency scenarios.
Customers know this and have entered long-term contracts. These give visibility to the company’s future cash flow and earnings. Moreover, it will seek to replicate its success in UAE into other GCC countries. RPM recently bagged a contract for Damman International Airport and is in discussions with Saudi Aramco and BP. The Group is also finalising its licenses in India, and intends to open a branch or a company shortly.
Another supporting factor is the accelerated privatisation programme in Saudi Arabia, which is expected to provide more significant opportunities to private health care operators.
RPM hopefully should be able to replicate the model implemented with companies like ADNOC and NMDC in Saudi Arabia.
The revenues have grown from Dh139.7 million in 2019 to Dh241.9 million in 2020, while EBITDA rose sharply from Dh36.1 million to Dh61.2 million. The substantial revenue and earnings growth make this an attractive choice.