Senores Pharmaceuticals plans IPO, files draft papers with SEBI

Senores Pharmaceuticals IPO

Ahmedabad-based Senores Pharmaceuticals has filed preliminary papers with capital markets regulator SEBI as it plans to raise funds via initial public offering.

The IPO is a mix of fresh issuance of equity shares worth Rs 500 crore and an offer-for-sale (OFS) of 27 lakh equity shares by the existing shareholders.

Promoters Swapnil Jatinbhai Shah, Ashokkumar Vijaysinh Barot, and Sangeeta Mukur Barot will be selling 17 lakh shares in the OFS, while Prakash M Sanghvi will be the other selling shareholder, offloading 10 lakh shares.

Promoters hold 66.67 percent stake in the pharma company and the remaining shares are owned by public shareholders.

Senores Pharma, which has presence in emerging markets, may consider raising Rs 100 crore (pre-IPO placement) before the filing of the red herring prospectus (RHP). The fresh issue size will be reduced accordingly to the extent of pre-IPO placement.

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The Shah and Barot family-owned company will spend the fresh issue proceeds on setting up a manufacturing facility for the production of sterile injections in the Atlanta facility, working capital requirements, and inorganic growth and other strategic initiatives. It will also repay its debt using the IPO funds.

By the end of fiscal 2024, the firm received approvals for 19 ANDAs (abbreviated new drug applications) and have commercialised 21 products in the United States and Canada. As of May 2024, it has identified and filed six ANDAs, six products are on stability, and two have ongoing exhibits. It also has three products that are ready for exhibit and 34 ANDAs are under development.

On the financial front, the company recorded nearly four times on-year growth in net profit at Rs 32.7 crore for the year ended March FY24, compared to Rs 8.4 crore in previous year. It was driven by robust revenue and tax write-back, but the growth was capped by a lower operating margin that was impacted by higher input cost.

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The profit and loss statement for fiscal 2024 includes impact of the acquisition of Havix and RPPL, hence, the numbers are not comparable with the previous financial years.

Revenue for the fiscal 2024 increased six-fold at Rs 214.5 crore as against Rs 35.3 crore in the previous financial year. On the operating front, EBITDA (earnings before interest, tax, depreciation and amortisation) grew by more than three-fold to Rs 41.6 crore from Rs 12.7 crore during the same period, but margin dropped to 19.4 percent in FY24 from 35.8 percent in FY23.

The company has appointed Equirus Capital, Ambit, and Nuvama Wealth Management as merchant bankers to the issue.