Aakaar Medical Technologies Ltd. IPO: Key Details

Aakaar Medical Technologies

• Aakaar Medical Technologies is coming out with an initial public offering (IPO) of 37,50,400 equity shares in a price band Rs 68-72 per equity share.
• The issue will open on June 20, 2025 and will close on June 24, 2025.
• The shares will be listed on SME Platform of NSE.
• The face value of the share is Rs 10 and is priced 6.80 times of its face value on the lower side and 7.20 times on the higher side.
• Book running lead manager to the issue is Indorient Financial Services.
• Compliance Officer for the issue is Anoopkumar Vishwanathan Pillai.

Profile of the company

Aakaar Medical Technologies was incorporated in the year 2013 under the leadership of Dilip Meswani who has been in the Aesthetic business since more than 25 years. He commenced his journey in the aesthetics business in 1999 through a proprietary business which was primarily selling Aesthetic Devices and then shifted his entire business under Aakaar Medical Technologies.

It is a medical aesthetic company dealing in a wide range of aesthetics & specialized cosmetic products & devices. Its product range includes both Own brands (domestically manufactured products & internationally manufactured devices) and Imported Brands (distribution of imported brands) from countries such as Korea, Spain, Italy, and Austria. It has established a distinctive presence in the medical aesthetic market by exclusively focusing on business-to-business(B2B) channels for product distribution and sales. 

It supplies its products & devices primarily to dermatologists, plastic surgeons, aesthetic physicians who then sell these products to their end consumers as well as use certain device consumables as part of their treatments. It derives majority of its revenue from Aesthetic products and will continue to focus on its Aesthetic products pipeline.

Proceed is being used for:

• Funding working capital requirements of the company
• General corporate purposes

Industry Overview

The medical aesthetics and cosmetic dermatology industry in India gained recognition in the late 1990s when Indian dermatologists and plastic surgeons introduced specialized services after advanced training abroad. Initially, treatments like chemical peels, microdermabrasion, and basic laser procedures were offered. As technology advanced and costs decreased in the 21st century, cosmetic procedures became more accessible. The rise of the internet, social media, and celebrity endorsements boosted public trust and acceptance. Low medical fees in India also attracted international patients. Today, cosmetic dermatology in India includes a wide range of treatments like Botox, dermal fillers, advanced laser procedures, and hair restoration, offered by dedicated clinics and professionals.

The Indian medical aesthetics and cosmetic dermatology market generated a revenue of $283.9 million in CY2024 and is expected to grow at a CAGR of 13.9% during the forecasted period to generate a revenue of $618.8 million in CY2030 The size of $283.9 million is the industry revenue for the products and devices sold to dermatologist, plastic surgeon and other practitioners. The Indian Medical aesthetic and cosmetic dermatology market, by type, is segmented into products and devices. Products segment is further bifurcated into four key categories: Skincare/Facial Care, Haircare, Body Contouring & Injectables, Chemical Peels. In 2024, Aesthetic Lasers and Energy Devices held the largest share of 33.7% of the market.

The wide range of demographic groups and their diverse treatment needs provide the ideal scenario for growth in all categories of the market. Urbanization has played a significant role, as city dwellers seek to improve their appearance and boost their confidence in highly competitive social and professional environments. Urbanization brings about higher levels of pollution, including air pollution, UV radiation, heavy metals, and particulate matter. These environmental stressors have detrimental effects on the skin, leading to issues such as premature aging, dullness, dehydration, and exacerbation of skin conditions like acne, eczema, psoriasis, rosacea, and hyperpigmentation. The rising incidence of these skin disorders contribute to the demand for dermatologist-recommended dermo cosmetic products or aesthetic treatments. 

Pros and strengths

Pan India reach through its consignment sales partner: The company has partnered with Parekh Integrated Services (PISPL) a leading logistics company in operation since 4 decades as its CSA partner. PISPL will store its products at its 21 warehousing centres across India which provides it easy accessibility to pin codes across India for distributing its products to the doctors and clinic chains. This has also helped it to minimize the lead time for its clients from placing an order to the final delivery of the product. Going forward its majority revenue will be through its CSA partner.

Diversified customer base: It has a large and dynamic customer base of doctors and clinic chains across India with new customers entering the mix every year. Also having a customer base of more than 5,000 (5,205 as at for Financial Year 2023-24) its top customers will be always be subject to change year by year. Its top 10 customers contribute 10.96% of the revenue of the company for Financial Year 2023-24.

Diversified product base: The company is engaged across multiple product segments with a wide product base of 154 SKUs as at March 31, 2025 and 5,41,754 units of SKUs sold in the Financial year 2024-25. Its diversified product base has led it to become a one stop destination for the dermatologists providing a range of products from Home Care to Professional Care to Injectable & Contouring to devices.

Risks and concerns

Substantial portion of the revenue comes from sale of imported third party manufactured brands: The company is a medical aesthetic company dealing in a wide range of aesthetics and specialized cosmetic products & devices. Its product range includes both, own brands (domestically manufactured products) and imported brands (distribution of imported brands) from countries such as Korea, Spain, Italy, and Austria. Its business relies significantly on long-term relationships with the international manufacturers for the procurement and distribution of specialized cosmetic and medical aesthetic products. Any disruption in these relationships, supply chain issues, or discontinuation of its alliance could adversely impact kits ability to maintain a steady inventory and supply continuity, affecting customer satisfaction and revenue.

Geographical constrain: The company’s registered office is situated in Maharashtra and its top 2 revenue contribution in terms of total revenue over the Financial Years ended March 31, 2025, March 31, 2024 and March 31, 2023 were Maharashtra & Karnataka contributing significantly to the revenue. Any unforeseen adverse events in these states could materially impact its financial performance, cash flows, and overall operational stability. Regulatory and policy changes, such as modifications in trade policies, taxation, or industry-specific compliance requirements, could hinder its ability to sell and distribute products in these regions.

Business is subject to seasonal variations: The company is engaged in the business of selling Aesthetic Products which is subject to seasonal fluctuations. It typically sees higher demand for its products during the second half of the year led by festivals, marriage seasons & other culturally significant operations. These events typically drive higher demand for its products. Consequently, it observes higher revenues for the quarters ending December 31 and March 31. Due to lower sales during the first two quarters, it continues to incur operating and fixed expenses, which is likely to negatively impact profitability within the same period. Given these seasonal fluctuations, comparative analysis of operating results between different periods within a single financial year may not always provide a meaningful indicator of its overall performance.

Outlook

Aakaar Medical Technologies is an aesthetic medical company that offers a diverse selection of specialized cosmetic products and devices. The company deals in speciality products for Dermatologists, Plastic Surgeons, Aesthetic Physicians, Cosmetologists. The company has a diversified product base with Pan India reach through its consignment sales partner. On the concern side, a substantial portion of the revenue is derived from sale of imported third party manufactured brands which exposes it to various risk. Moreover, the company requires significant amount of working capital for a continuing growth. Its inability to meet its working capital requirements may adversely affect its results of operations.

The company is coming out with a maiden IPO of 37,50,400 equity shares of Rs 10 each. The issue has been offered in a price band of Rs 68-72 per equity share. The aggregate size of the offer is around Rs 25.50 crore to Rs 27.00 crore based on lower and upper price band respectively. On performance front, revenue from operations increased by 33.55% from Rs 4611.10 lakh in Financial Year 2023-2024 to Rs 6,158.28 lakh in Financial Year 2024-25 primarily due to increasing revenue from the existing customer base & addition of new product SKUs resulting higher sales of own brand products. Moreover, the profit after tax increased by 110% from Rs 287.02 lakh in Financial Year 2023-24 to Rs 603.95 lakh in Financial Year 2024-25.

The company plans to expand its geographic reach and sales force by scaling up operations in both new and existing territories. It is constantly expanding its sales team which is crucial to effectively penetrate new cities and markets. Its sales team has gone up from 53 in Financial Year 2021-22 to 133 as of March 31, 2024. It is looking at expanding in Tier 2 markets like Nashik, Baroda, Rajkot, Udaipur, Jodhpur, Ranchi etc. Further, introducing products tailored for professional care, home care, and Aesthetic Devices, the company aims to meet evolving market demands and attract new customers. This includes expanding their reach beyond dermatologists to include plastic surgeons, maxillo-facial surgeons, obstetricians, gynaecologists, and other specialized medical professionals.