Anlon Healthcare shares make muted market debut, list at 1% premium to IPO price

Anlon Healthcare listing ceremony at NSE

The shares of Anlon Healthcare made a muted market debut on September 3, listing at Rs 92 apiece on NSE. This marks a premium of around 1 percent over the IPO price of Rs 91 per share.

After listing, the shares recorded some minor losses to close at Rs 91.70 apiece.

On BSE, the shares listed flat at the IPO price of Rs 91 apiece, with zero premium.

The listing premium is at par with grey market estimates. Ahead of listing, the unlisted shares of the company were trading with a 1 percent grey market premium (GMP) over the IPO price at Rs 92 apiece, according to data on Investorgain.

The maiden public issue saw strong investor interest during its three days of public bidding, being subscribed more than 7 times its offer size. Anlon Healthcare, that produces pharmaceutical intermediates and active pharmaceutical ingredients (APIs), moved to the capital markets to raise over Rs 121 crore through a fresh issue of 1.33 crore shares at a price band of Rs 86-91 per share.

Proceeds from the issue will be deployed towards expansion of the company's manufacturing facility (Rs 30.7 crore), funding working capital (Rs 43.15 crore), repayment of debt, and general corporate purposes.

“At the upper price band company is valuing at P/E of 19.0x to its FY25 earnings, with EV/EBITDA of 16.7x and market cap of Rs 4,836 million post issue of equity shares. investors may continue to HOLD the issue as a Long term view on IPO according to their risk appetite,” said Narendra Solanki, Head Fundamental Research- Investment Services, Anand Rathi Shares and Stock Brokers.

Anand Rathi advised investors to subscribe to the issue for the long term. “At the upper price band company is valuing at P/E of 19.0x to its FY25 earnings, with EV/EBITDA of 16.7x and market cap of Rs 4,836 million post issue of equity shares. We believe that the IPO is fully priced,” the brokerage said.

Shivani Nyati, Head of Wealth at Swastika Investmart, however advised investors to avoid the issue. "The company focuses on manufacturing and marketing specialized APIs in line with global standards. It positions itself as the first producer of Loxoprofen and related formulations. In FY24, its revenue growth was impacted due to the registration process in Brazil. The company’s operations are highly dependent on a single facility located in Rajkot, Gujarat. Looking at the latest financials, valuation seems Fully priced. Hence, investors may consider avoiding this IPO," the analyst said.

"Investors must weigh the modest scale of operations, lack of dividend history, and aggressive pricing against the strategic optionality of its custom synthesis segment and planned capex deployment. This is a company seeking capital not just for growth but for transformation," said Harshal Dasani Business Head, INVasset PMS.

"In a market increasingly favoring innovation-led, compliance-ready pharmaceutical firms, Anlon's differentiated product slate could justify a re-rating over time. That said, given the valuation optics, the offering may suit only long-term participants with risk appetite and domain familiarity," he added.

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