BW Explains: All The Info You Need On The Mankind Pharma IPO That Opens Today
Pharma major Mankind Pharma is all set to open its maiden public offering, the first biggest IPO in terms of issue size, today. The investors are excited about this company’s debut IPO and even the market experts are keeping a watch on the same. BW Explains tries to explore everything you may need to know before you decide to subscribe.
The Dates of the IPO, Price Band and Offer Size
The offer will open for public on 25 April 25, and the closing date for the same is 27 April, 2023. The company already opened its anchor book, a part of QIB portion, on 24 April. The price band for the issue has been fixed at Rs 1,026-1,080 per share. On offer are of over 4 crore equity shares by promoters and investors.
The total fundraising by the company would be Rs 4,110.03 at the lower price band, and Rs 4,326.35 crore at the higher band.
Over 1 crore shares will be sold through an offer for sale by the three promoters Ramesh Juneja, Rajeev Juneja, and Sheetal Arora, while the rest of the shares in the OFS are to be sold by the following investors: Cairnhill CIPEF, Cairnhill CGPE, Beige, and Link Investment Trust.
Objectives of Issue
The primary objectives of the offer would be to complete the selling shareholders' offer for sale and reap the rewards of listing the equity shares on public markets. The company won't get any money from the offer; all proceeds from public offerings will go to selling shareholders.
Size of the IPO
Investors can make a minimum bid of 13 equity shares and then bid in multiples of 13 shares. Therefore, for one lot of 13 shares, the lowest application size for retail investors would be Rs 14,040, and the maximum investment would be Rs 1,96,560 for 14 lots (182 shares).
The remaining 50 per cent of the offer size has been set aside by the company for regular investors, 15 per cent for high net worth individuals, and 50 per cent for eligible institutional buyers.
Profile of Mankind Pharma
Mankind Pharma claimed to be India's fourth-largest pharmaceutical company in terms of domestic sales and third-largest in terms of sales volume for MAT December 2022, as per IQVIA dataset. The company develops and manufactures a diverse range of pharmaceutical formulations across various acute and chronic therapeutic areas, as well as several consumer healthcare products.
The domestic market has been the company's primary focus; it generated 97.60 per cent of operating revenue in FY22 and grew at a CAGR of 12 per cent between FY18 and FY22 and 15 per cent between FY20 and FY22. Domestic sales in the Indian Pharma Market (IPM) are now ranked fourth instead of eighth, as they were in FY12. 10 per cent of domestic sales were in the consumer healthcare products sector.
Financial Status
For the nine months that ended in December of FY23, the pharmaceutical company, which has a market capitalization of Rs 43,264 crore, reported a consolidated profit of Rs 996.4 crore, a 20 per cent decrease from the same period the previous year due to lower other income, higher employee costs, and weak operating results.
Consolidated revenue for 9MFY23 grew by 10.6 percent year-on-year to Rs 6,697 crore, while on the operating front, it has recorded nearly 13 percent YoY drop in EBITDA (earnings before interest, tax, depreciation and amortisation) at Rs 1,484 crore with margin falling 598 basis points compared to corresponding period last fiscal.
However, for the year ended March FY22, the performance was better, though we have seen operating margin contraction. Profit for financial year 2021-22 increased by 13.3 percent to Rs 1,433.5 crore and revenue rose by 25.2 percent to Rs 7,782 crore compared to previous year.
EBITDA for the financial year 2021-22 at Rs 1,989.35 crore grew by 20.7 percent, but margin dropped 96 bps to 25.56 percent compared to FY21.
Details About Promoters
The promoters of the company are Ramesh Juneja, Rajeev Juneja, Sheetal Arora, Ramesh Juneja Family Trust, Rajeev Juneja Family Trust and Prem Sheetal Family, having a shareholding of 67.29 percent in the company. Currently, total promoters and promoter group's stake in the company stands at 79 percent, and the rest is held by investors including Beige, and Cairnhill CIPEF.
Ramesh Juneja is the Chairman and Whole-Time Director of Mankind, and Rajeev Juneja is the Vice-Chairman and Managing Director. Sheetal Arora is the Chief Executive Officer and Whole-Time Director of the company, while Satish Kumar Sharma is the Whole-Time Director on the board. Ashutosh Dhawan is the Chief Financial Officer of the company, while Pradeep Chugh is working as the Company Secretary and Compliance Officer, and Associate Vice President of the company.
Listing Dates And Allotment
By 3 May, Mankind will finalise the total IPO share allotment. The shares are scheduled to be transferred to qualifying investors' demat accounts by 8 May, while refunds will be given to unsuccessful investors' bank accounts by 4 May.
The company’s IPO will make its debut on the BSE and NSE on 9 May.
