Veeda Clinical Research on Wednesday (September 29) said it has filed a draft red herring prospectus (DRHP) with capital markets regulator Securities and Exchange Board of India (Sebi) to launch its initial public offer (IPO).
The Clinical research organisation’s issue will consist of fresh equity shares worth up to Rs 331.60 crore and an offer for sale (OFS) of Rs 500 crore by the promoters and existing shareholders.
Investors participating in the OFS include CX Alternative Investment Fund for up to Rs 8.08 crore; Arabelle Financial Services Limited for Rs 90.19 crore; Bondway Investment Inc. for Rs 259.77 crore; Stevey International Corporation for Rs 0.04 crore and Basil Private Limited for Rs 141.93 crore.How the funds will be used
The company intends to utilise the net proceeds from the fresh issue to repay debt, fund capital expenditure, invest in/fund further acquisitions by subsidiary Bioneeds, fund working capital requirements and towards general corporate purposes.
The Ahmedabad-based company is backed by CX Partners. In June it announced raising $16 million from PE firms Sabre Partners and high networth individuals, including Pranab Mody of JB Chemicals, Havells India’s family office, Nikhil Vora of Sixth Sense Ventures and Arjun Bhartia of Jubilant Group.
Furthermore, to support its capabilities and offer top-notch clinical services for novel drugs, Veeda acquired a 50.1 percent stake in Bengaluru-based Bioneeds India Private Limited after it had acquired a substantial minority stake in the company between March and July 2021.Large-scale operations
Veeda Clinical Research has grown from a single facility in 2004 to four facilities today and has the capability to process 1 lakh samples per month. It is one of the largest independent full-service clinical research organisations (CRO) in India as of March 31, 2020, on the basis of revenue, according to the Frost & Sullivan report presented in its DRHP.
The company specialises in the focused segment of Bio Availability/Bio Equivalence (BA/BE) studies. In addition to BA/BE tests, it offers a broad range of services across most aspects of the drug development and drug-launch value chain throughout global markets, including North America, Europe and Asia.
In FY21 it completed studies for 157 clients, some of the prominent ones being Dr Reddy’s, Mankind Pharma, Granules India and Novugen Pharma.
As of March 2021, Veeda Clinical Research had conducted more than 3,500 trials and developed more than 1,000 bio-analytical methods across generics. It has also been able to complete over 85 global inspections with regulatory authorities such as the USFDA, UK-MHRA, WHO, ANVISA, DGCI and EMA.Veeda Clinical Research’s revenue from operations stood at Rs 195.81 crore for the year ended March 2021, while its profit after tax during the year stood at Rs 62.97 crore.
The CRO Market in India captures 3 percent of the global market share by value and is expected to be the fastest growing market, with a CAGR of 12 percent between 2021 and 2026.
SBI Capital Markets Limited, ICICI Securities Limited, JM Financial Limited and Systematix Corporate Services Limited are the book running lead managers for the issue.